Discovery Labs provides expanded update on efforts to gain FDA marketing authorization for Surfaxin in RDS

Discovery Laboratories, Inc. (Nasdaq:DSCO) is providing an expanded update regarding ongoing efforts to file a Complete Response intended to gain U.S. Food and Drug Administration (FDA) marketing authorization for Surfaxin^® for the prevention of respiratory distress syndrome (RDS) in premature infants.  On January 10, 2011, Discovery Labs issued a press release reporting that the FDA had recently provided detailed, written direction in response to an earlier submitted proposal by Discovery Labs relating to its ongoing comprehensive preclinical program intended to gain Surfaxin approval. Throughout the conduct of the program, Discovery Labs has been interacting with the FDA and incorporating the FDA's guidance into its efforts to complete the program and file the Surfaxin Complete Response. The filing of the Complete Response is currently targeted for early third quarter 2011 and anticipated to lead to a potential approval early in the first quarter 2012. 

The Company will host a conference call this morning at 10:00 AM EST to provide an update regarding certain activities relating to the Surfaxin Complete Response. The call-in number is 866-332-5218.

If approved, Surfaxin would become the first synthetic, peptide-containing surfactant for commercial use in neonatal medicine.  The safety and efficacy of Surfaxin for neonatal RDS has previously been demonstrated in a large, multinational Phase 3 clinical program.  

Surfaxin^® for Neonatal RDS – Status of Comprehensive Preclinical Program for Filing Complete Response to Gain FDA Marketing Authorization

Discovery Labs believes that a key remaining step to potentially gain FDA marketing approval for Surfaxin is to satisfy the FDA as to the final validation of the fetal rabbit biological activity test (BAT). The BAT is an important quality control release and stability test for Surfaxin. Final BAT validation is intended to satisfy the FDA with respect to the ability of the BAT to adequately reflect the biological activity of Surfaxin throughout its shelf life and to discriminate biologically active from inactive Surfaxin drug product. Discovery Labs has been conducting a comprehensive preclinical program with regard to this key remaining step. The BAT has undergone a number of method refinements intended to optimize its performance and reduce assay variability. The optimized BAT has subsequently been used to generate data to support BAT validation as well as to demonstrate concordance between the BAT and the well-established preterm lamb model of RDS by performing a series of prospectively-designed, side-by-side preclinical studies (i.e., concordance studies).  Data from the preterm lamb model and BAT concordance studies are intended to support final BAT validation and to demonstrate comparability of drug product used in the Phase 3 clinical program with Surfaxin drug product to be manufactured for commercial use. 

Discovery Labs has been interacting with the FDA in an effort to ensure that the comprehensive preclinical program (and the Surfaxin Complete Response) will ultimately satisfy the FDA as to the final validation of the BAT.  The FDA's most recent communication clearly indicates that several aspects of Discovery Labs' proposed approach to the BAT validation are reasonable and provides detailed, written direction regarding certain components of Discovery Labs' comprehensive pre-clinical program. Discovery Labs believes that it can incorporate the FDA's direction into its ongoing efforts to complete the comprehensive preclinical program and be in a position to file a Surfaxin Complete Response by early third quarter 2011, which, after an anticipated six-month FDA review cycle, could lead to potential Surfaxin approval early in the first quarter 2012. 

BAT Optimization and Final Validation:  Before undertaking steps to optimize the BAT, Discovery Labs submitted a proposal to FDA outlining several specific method refinements intended to improve BAT performance and reduce assay variability. After taking into account the FDA's response, Discovery Labs incorporated the proposed method refinements into the BAT and conducted testing that demonstrates that all pre-specified acceptance criteria were met and that BAT optimization has resulted in a greater-than-40% reduction in assay variability relative to the BAT methodology that was employed prior to 2010.

Following BAT optimization, at the FDA's suggestion, Discovery Labs submitted an additional proposal regarding specific and detailed aspects of final BAT validation. With respect to certain technical criteria relating to final BAT validation, the recent communication directs Discovery Labs to increase the sample size of specified data sets by testing additional Surfaxin batches.  Discovery Labs currently has data from several batches that have previously been manufactured and analyzed. To be responsive to FDA's direction, Discovery Labs has initiated and anticipates completing manufacture of additional Surfaxin batches in the first quarter of this year. The additional batches will be tested using the optimized BAT and the additional data will be incorporated into the Complete Response.

Concordance Studies – Throughout the conduct of the comprehensive preclinical program, Discovery Labs has interacted with the FDA on certain aspects of the concordance studies. Multiple Surfaxin batches have been used to assess the biological activity of Surfaxin via measurement of respiratory compliance at various time points across the proposed shelf-life in both the preterm lamb model and the optimized BAT. The FDA has previously indicated that, to gain Surfaxin approval, data generated in the concordance studies must demonstrate the same relative changes in biological activity over time in both models using both regression analysis as well as a point-to-point comparison.   Discovery Labs has evaluated the concordance data generated to date by these models using both regression analysis and point-to-point comparisons. Discovery Labs believes that these data demonstrate the same relative changes in biological activity over time in both the optimized BAT and the preterm lamb models and support the comparability of drug product used in the phase 3 clinical program and Surfaxin drug product to be manufactured for commercial use.

The most recent proposal submitted by Discovery Labs to the FDA also requested clarification with respect to certain limited technical aspects of the concordance study. The FDA's response includes detailed direction with respect to generating limited additional confirmatory data through further concordance testing. Discovery Labs plans to generate these additional data for inclusion in the Complete Response, which data must be consistent with the concordance data generated to date.