Specialty biopharma company, Auxilium Pharmaceuticals, Inc. (AUXL), recently announced the commencement of patient dosing in a phase III program that is being conducted with Xiaflex. The company said that the first patient has been dosed in the study that is evaluating Xiaflex for the treatment of Peyronie’s disease.

 

Earlier, Auxilium Pharma had reported positive results from two phase II trials and mixed data from a phase IIb study for the Peyronie’s indication. The company is currently conducting two randomized double-blind placebo-controlled phase III studies, one open label study, and one pharmacokinetic study with Xiaflex for the indication.

 

Auxilium Pharma expects to finish enrolling patients for the double-blind studies in the first quarter of 2011. Top-line results should be out in first half of 2012.

 

Xiaflex received approval in February 2010 from the US Food and Drug Administration (FDA) for the treatment of Dupuytren’s Contracture (DC), a condition that affects the connective tissue in the palm known as palmar fascia.

 

Label expansion could help Xiaflex sales cross $1 billion. Meanwhile, Auxilium Pharma is looking to conduct additional studies with Xiaflex for frozen shoulder syndrome. Frozen shoulder syndrome is a disorder of diminished shoulder motion and almost 3% of people, especially women, develop this problem over their lifetime. Other indications for which Xiaflex could be developed include cellulite and lipoma.

 

Neutral on Auxilium

 

We currently have a Neutral recommendation on Auxilium Pharma. Although Auxilium Pharma’s lead product, Testim, continues to perform well, tough competition and the potential for a generic alternative beyond 2011 could limit the ultimate potential of the drug.

 

Given the eventual slowdown in Testim growth, Auxilium Pharma’s future relies heavily on Xiaflex. Going forward, we expect investor focus to remain on the successful commercialization of Xiaflex, and label expansion of the product for additional indications.

 
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