FDA’s approval of NIcox’s cetirizine eye drop formulation triggers $35M in NIcox shares

On October 10, 2016, Nicox announced that it had received a Complete Response Letter (CRL) from the U.S. Food and Drug Administration (FDA) regarding the New Drug Application (NDA) for AC-170, its novel, proprietary, cetirizine eye drop formulation, for the treatment of ocular itching associated with allergic conjunctivitis. The FDA`s stated reason for the CRL pertains solely to a Good Manufacturing Practice (GMP) inspection at a third party facility producing the active pharmaceutical ingredient (API), cetirizine, and supplying it to the manufacturer of the finished product. The safety and efficacy data submitted by Nicox in the AC-170 NDA have not resulted in the FDA requesting any further clinical or non-clinical testing for the approval of the AC-170 NDA. Furthermore, the CRL did not include any concerns related to the finished product manufacturing facility.
“We expect to further advance our position as a leading ophthalmic R&D company with the anticipated FDA decisions on latanoprostene bunod, which is licensed worldwide to Bausch + Lomb, and AC-170, as well as the planned commencement of Phase 2 clinical trials for both NCX 4251 and NCX 470,” commented Michele Garufi, Chairman and Chief Executive Officer of Nicox.

Nicox said it would resubmit the AC-170 NDA once the FDA`s concerns have been addressed by the relevant manufacturing party.

The company stated that the approval of the AC-170 NDA after December 1, 2016 would trigger a milestone payment of $10 million in Nicox shares to ex-Aciex shareholders or $35 million in Nicox shares if approval of the NDA is received before this date.

The monetary amount of the payments due will be reduced by the costs incurred by Nicox in running the additional clinical safety study on AC-170. Nicox estimates that this reduction will be $3.2 million, the maximum allowable under the terms governing the warrants associated with the share payments. AC-170 was developed by Aciex Therapeutics, Inc., which became a wholly-owned subsidiary of Nicox in October 2014 and was subsequently renamed Nicox Ophthalmics, Inc.