Dissapointing results for Inspire

Dry eye can be a painful and irritating condition. Current there is only one drug on the market to treat severe dry eye, Restasis. Restasis is a formulatoion of cyclosporine, an immunosuppresive agent. It is used to reduce ocular inflammation, believed to be the cause of dry eye disease. Restasis was jointly developed by Allergan and Inspire. Inspire pharma's lead candidate is another treatment for dry eye, Diquafosol. It works by activating receptors on the eye surface, stimulating the "release of water, salt, mucin and lipids - the key components of natural tears". Today they announced results from a phase III study of the drug, the fourth phase III study they have done. The outcome was dissapointing, with the primary goal, corneal clearing, failing to show a difference from placebo. There was an improvement in some secondary areas, such as corneal staining, conjunctivital staining, and conjunctivial clearing. Overall, the trial was a letdown though, and investors let it be known by sending the stock down 45%. The biotech firm does have a FDA approvable letter for the drug, but conditions must still be met before approval. It is not clear whether they have the case the FDA is looking for. Inspire is considering a fifth phase III trial, and will also pursue a trial using the drug to facilitate corneal wound healing.

Piper Jaffray Senior Research Analyst Mark Karvosky was upbeat despite the news, writing that there was still hope for the drug, which he thinks eventually will be approved.
"Diquafosol's failure to meet its primary endpoint is clearly negative and increases its risk profile," he writes. "However, we remind investors that ISPH has an approvable letter for diquafosol and the FDA has been flexible in approving dry eye products, namely Restatsis. We believe that the lack of formal FDA guidance for dry eye could help ISPH by allowing flexibility in the interpretation of the existing data."

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