Ipsen warns of shortages of its orphan drug Increlex

French drugmaker Ipsen says shortages of its orphan drug Increlex appear inevitable because of ongoing issues at a Lonza plant in the U.S. The drug is used to treat a rare condition in children called IGF-1 deficiency, which results in them being very short for their age. 

Ipsen ($IPN) said Thursday doctors and patients can expect supply interruptions to begin appearing in the U.S. now and in Europe and the rest of the world by the third quarter. It does not anticipate the problem being resolved before the end of the year. The drugmaker said Lonza is working with the FDA to get on top of issues at its plant in Hopkinton, MA, while Ipsen is diligently managing supplies to "reduce its impact on the patients and their families."

Ipsen has been battling to keep a steady supply of the drug for more than a year-and-half after the FDA in a 2011 warning letter questioned whether Lonza could stand behind the potency and purity of APIs being manufactured at the Hopkinton facility. In 2012, Ipsen sold €28.3 million ($36.8 million) worth of Increlex.

It has been a tough 6 months for Ipsen. The company's partner in the development of a hemophilia drug, Inspiration Biopharmaceuticals, filed for bankruptcy in October after the FDA clamped a clinical hold on the lead program. Ipsen took a €100 million ($130 million) after tax writedown as a result. Earlier this year, the partners unloaded the two lead hemophilia drugs from their collaboration, including one for a hemophilia A candidate called OBI-1 to Baxter International ($BAX) in a deal valued at $185 million that included a $50 million upfront payment. Baxter also bought a manufacturing facility in that deal. They sold their hemophilia B candidate, IB1001, to Canadian biotech Calgene for an upfront payment of $5.9 million and promises of up to $50 million in milestone payments. 

- here's the release