Flexion Therapeutics entered the ranks of commercial biotechs on Friday with the approval of its first drug, Zilretta, to treat osteoarthritic knee pain. The company is in the "final stages" of launch preparations, executives told analysts on a call early Monday, leaning on a sales force of 103 professionals to introduce a med that's expected to become the standard of care.
A nonopioid injection that provides relief from osteoarthritic knee pain for 12 weeks, Zilretta won FDA approval based on a phase 3 study in 484 patients at 37 centers worldwide, according to Flexion's Friday announcement. About 14 million Americans suffer from the condition, and 5 million receive treatment via injections each year, Wells Fargo analyst David Maris said.
Flexion believes its sales team can cover 9,000 orthopedists and rheumatologists to reach more than three-quarters of the market, Maris wrote in a note following approval.
Doctors are enthusiastic about the drug and said "they will use it in a large number of patients, and even use it off-label in hips and shoulders," Maris wrote after his team conducted a survey of medical professionals. On Monday's conference call, executives said the company plans trials in osteoarthritic hip and shoulder pain; new approvals in those joints would expand Zilretta's market considerably.
Several aspects of Zilretta's official FDA label won praise from analysts and executives. First, the FDA included data demonstrating the drug's safety in diabetes patients. Plus, the agency isn't requiring a postmarketing study and stipulated that the drug can be stored at room temperature for up to six weeks, increasing flexibility for treatment centers.
To prepare for the drug's approval, Flexion previously extended contingent employment offers to 103 sales professionals. Those offers are now official and Zilretta should be available by the end of this month, executives said.
A full rollout won't come until Thanksgiving, however, as the sales team members need to notify their current employers and undergo several weeks of training. On Monday's call, executives described 2018 as a "foundational" year for the launch while adding that 2019 will be the "growth" year. RBC Capital Markets analyst Randall Stanicky said in a note his team projects $1.05 billion in sales by 2023. Maris sees Zilretta becoming the "standard of care" for osteoarthritic knee pain.
Flexion is introducing its drug at a list price of $570 per injection, according to Maris. The company declined to provide its own sales estimates on Monday's call. Maris further believes the company could get a boost next year by licensing ex-U.S. rights.
The biotech's shares are up nearly 20% on the news. Flexion was previously at the center of buyout buzz after a source told FiercePharma its board accepted a nonbinding offer worth more than $1 billion from Sanofi. The source said the deal may not ultimately happen, and so far nothing from the rumors has come to fruition.