Vanda secures FDA approval for Fanapt to treat bipolar I, 15 years after schizophrenia nod

Fifteen years after gaining its first FDA approval for Fanapt (iloperidone) to treat schizophrenia, Vanda Pharmaceuticals has scored again with the same antipsychotic drug.

The FDA has signed off on Fanapt tablets to treat adults with manic or mixed episodes associated with bipolar I disorder. Those with manic or mixed episodes are a subset of the 10 million in the U.S. with bipolar I, which is characterized by mood swings from euphoria to depression.

The approval “significantly increases the commercial opportunity for Fanapt," Vanda said in a release. Investors agreed as Vanda’s share price increased by 40% on Wednesday morning. The boost is much needed for the Washington, D.C.-based company which has seen revenue fall from a record high of $269 million in 2021 to $193 million last year.

Iloperidone has a long history dating to the mid-1990s, with Novartis and Titan Pharmaceuticals taking turns developing it before Vanda acquired it in 2004. After rejecting iloperidone in 2008 because of a lack of clinical data, the FDA approved it in 2009.

Upon its launch, Jefferies analysts estimated sales would reach $300 million by 2013. But Fanapt never met those expectations. Over the next decade, sales increased slowly, peaking at $95 million in 2021. Last year, Fanapt generated $90 million in revenue.

Vanda’s revenue slide over the last two years is attributed largely to declining sales of its other major product Hetlioz (tasimelteon), a treatment for the circadian rhythm disorder Non-24. Generic competition in the U.S. has caused Hetlioz sales to tumble from $160 million in 2022 to $100 million last year.

Over the years, Vanda has been unsuccessful in its bid to gain approvals for Hetlioz to treat insomnia and jet lag disorder.

The company is hoping to fill the revenue void by spending $100 million to secure rights in the U.S. and Canada to Johnson & Johnson's multiple sclerosis treatment Ponvory. Vanda made the deal in December of last year.

The FDA based its latest approval of Fanapt on results from a phase 3 trial of 400 patients. Those on Fanapt showed improvements on the Young Mania Rating Scale over four weeks compared to those on placebo. Evidence of improvement was seen as early as two weeks of being on the medication.

Fanapt comes with a boxed warning about an increased risk of death for elderly patients with dementia-related psychosis who are treated with antipsychotic drugs. Vanda is also investigating Fanapt as a treatment for post-traumatic stress disorder (PTSD).