InterMune Inc. (Nasdaq: ITMN) soared 144.50 percent on after a European advisory panel recommended that Esbriet, the company’s lung disease drug, be approved for sale in the European Union (EU).
In the event that the European Medicines Agency accepts the panel's recommendation, Esbriet will be approved in all 27 EU nations as a treatment for idiopathic pulmonary fibrosis, a terminal disease that causes scarring in the lungs. It is believed that more than 100,000 people in Europe suffer from this condition.
InterMune is seeking to get Esbriet approved as a treatment for a milder form of the disease, which affects about 70,000 people. Currently, no drugs exist on the market for this affliction.
Between 50 and 70 percent of patients die within five years of being diagnosed with the disease, InterMune noted.
Due to the relative rarity of the disease, InterMune enjoys marketing exclusivity on Esbriet until 2021.
InterMune’s Chairman, President and CEO Dan Welch said he wants Esbriet to be priced like drugs that treat pulmonary arterial hypertension – such drugs typically cost $40,000 to $45,000 per year per patient in Europe.
InterMune said it expects a final decision within three months, and that it is preparing to launch Esbriet (also known as pirfenidone) in Europe, starting in Germany and France.
In early May, InterMune shares crashed 75 percent in one day (from closing at $45.44 on May 4, to closing at $11.38 the next day) after the U.S. Food and Drug Administration (FDA) requested that the conduct additional clinical trials on Esbriet, despite positive recommendation from one of the FDA's advisory panels.
Thus approval of the drug in the U.S. appears to be a long-shot.