10-K: Milestone Pharmaceuticals Faces Setback with FDA Rejection, Resubmission Planned for Etripamil

Milestone Pharmaceuticals received a refuse-to-file letter from the FDA for its etripamil NDA, but plans to resubmit in the second quarter of 2024 after addressing data clarification requests.

Summary

• Milestone Pharmaceuticals received a refuse-to-file letter from the FDA regarding its New Drug Application (NDA) for etripamil nasal spray for the treatment of paroxysmal supraventricular tachycardia (PSVT).
• The FDA requested clarification on the timing of adverse event data recorded in Phase 3 clinical trials, but did not express concerns about the nature or severity of the adverse events.
• Milestone held a Type A meeting with the FDA in February 2024 and plans to resubmit the NDA in the second quarter of 2024 after restructuring the data sets and reformatting certain data files.
• The company expects a standard NDA review period following the resubmission and has implemented cash conservation measures to extend its cash runway into 2026.
• If the FDA approves etripamil, Milestone expects to receive a $75 million payment under an existing royalty agreement to fund the commercial launch.
• Milestone is also developing etripamil for atrial fibrillation with rapid ventricular rate (AFib-RVR) and presented positive Phase 2 data in November 2023.
• The company anticipates progressing to an End of Phase 2 meeting in mid-2024 to finalize the registrational study protocol for AFib-RVR.
• Milestone estimates the PSVT market affects approximately two million Americans, with a target addressable market of 500,000 to 800,000 patients.
• The company estimates the AFib-RVR market could reach three to four million patients by 2030.

Sentiment

Score: 5

Explanation: The document presents a mixed picture. While there are positive developments such as the positive Phase 2 data for AFib-RVR and the potential for a $75 million payment upon FDA approval, the FDA's refuse-to-file letter and the need for a resubmission are significant setbacks. The company's financial position is also a concern, with ongoing losses and a need for additional funding.

Positives

• Milestone has a clear path forward for NDA resubmission after a Type A meeting with the FDA.
• The company's cash runway is extended into 2026 due to cash conservation measures.
• Positive Phase 2 data for etripamil in AFib-RVR supports further development for this indication.
• The company has a large estimated target market for both PSVT and AFib-RVR.
• The RAPID trial demonstrated a statistically significant and clinically meaningful difference in time to SVT conversion with etripamil compared to placebo.

Negatives

• The FDA issued a refuse-to-file letter for the etripamil NDA, indicating deficiencies in the initial submission.
• The NDA resubmission is delayed until the second quarter of 2024.
• The company has incurred significant operating losses since inception and anticipates continuing to incur substantial operating losses for the foreseeable future.
• Milestone is dependent on the successful clinical development and regulatory approval of etripamil, its only product candidate.

Risks

• The company may not be able to resubmit the NDA on the expected timeline or that the FDA will accept the NDA for review following resubmission.
• There is no guarantee that the FDA will approve the NDA, even if accepted for review.
• Milestone may not be able to achieve or maintain profitability.
• The company will require substantial additional funding to finance its operations.
• Raising additional capital may cause dilution to shareholders, restrict operations, or require relinquishing rights to product candidates.
• Economic uncertainty, including inflation, may adversely affect the company's results of operations.
• The company's future success is substantially dependent on the successful clinical development and regulatory approval of etripamil.
• The company may encounter substantial delays or difficulties in its clinical trials.
• Enrollment and retention of patients in clinical trials is an expensive and time-consuming process and could be delayed.
• If the market opportunities for etripamil are smaller than estimated, the company's business may suffer.
• Coverage and adequate reimbursement may not be available for etripamil, which could make it difficult to gain market acceptance.

Future Outlook

Milestone expects its existing cash resources to fund operations into 2026, including through the expected Prescription Drug User Fee Act date for the NDA resubmission. The company plans to resubmit the NDA for etripamil for PSVT in the second quarter of 2024 and anticipates progressing to an End of Phase 2 meeting in mid-2024 to finalize the registrational study protocol for AFib-RVR.

Management Comments

• The FDA indicated that the timing of AEs in question had minimal impact on the overall characterization of the etripamil safety profile.
• Based on the guidance received during the Type A Meeting, we expect that this approach will address the RTF from the FDA.

Industry Context

The document highlights the unmet need for self-administered treatments for PSVT and AFib-RVR, positioning etripamil as a potential solution to reduce reliance on emergency department visits. The company is leveraging the established use of calcium channel blockers in these conditions to support the development of etripamil.

Comparison to Industry Standards

• The document notes that current treatments for PSVT include intravenous administration of drugs like adenosine, verapamil, and diltiazem, which require medical supervision, and oral medications that are not acutely effective. Etripamil is positioned as a novel, self-administered alternative.
• For AFib-RVR, the document mentions that oral rate control drugs have a delayed onset of action, often requiring emergency department visits for acute treatment. Etripamil is being developed to provide a faster-acting, self-administered option.
• The document references InRhythm (flecainide) from InCarda Therapeutics and AAP30663 from Acesion Pharma as competitors in the AFib space, but these are not direct competitors as they are not self-administered nasal sprays.

Related Party Transactions

• The company has a license and collaboration agreement with Ji Xing Pharmaceuticals, an entity affiliated with RTW Investments, LP, a major shareholder.
• The company entered into a Royalty Purchase Agreement and a Note Purchase Agreement with RTW Investments, LP and certain of its affiliates.

Stakeholder Impact

• Shareholders may experience dilution from future capital raises.
• Employees may be affected by the company's restructuring and cash conservation measures.
• Patients may benefit from the potential approval of etripamil as a self-administered treatment for PSVT and AFib-RVR.
• Healthcare providers may have a new tool for managing PSVT and AFib-RVR.
• Payors may see a reduction in emergency department visits and healthcare costs if etripamil is approved.

Next Steps

• Milestone plans to resubmit the NDA for etripamil for PSVT in the second quarter of 2024.
• The company anticipates progressing to an End of Phase 2 meeting in mid-2024 to finalize the registrational study protocol for AFib-RVR.
• Milestone will continue to develop etripamil for AFib-RVR and explore other therapeutic applications.
• The company will continue to evaluate strategic collaborations for commercialization outside of the United States.

Key Dates

Keywords

etripamil, PSVT, AFib-RVR, FDA, NDA, clinical trials, cardiovascular, arrhythmia, nasal spray, regulatory approval