Summary
Transcept is developing Intermezzo for Middle of Night Insomnia. Intermezzo is low dose zolpidem (same chemical as Ambien). FDA's questions delay access to the $7 billion US sleep disorder market. Transcept's shares dropped dramatically on the news
Analysis
It is never good news when a company's stock drops from around $14 to just over $5 in a week, and so this is a difficult time for Transcept, although there are signs the company will rally and finally gain approval for Intermezzo.
The US sleep disturbance market is sizable: drug sales accounted for around $7 billion in 2008 while the larger market (pillows, devices etc) was worth over $23 billion. A surprisingly large number of Americans report sleep disturbance, with 58% claiming to suffer from one form or another. Intermezzo is designed to treat Middle Of Night insomnia which the company claims affects one third of adults.
Insomnia is a broad claim and Transcept appear to have targeted and claimed this niche indication, so it's not difficult to see why this full response from FDA was so disappointing, especially coming on the back of a lucrative licensing deal with Purdue Pharmaceuticals.
Presumably the company gained agreement for this indication before embarking on the study and might even have anticipated FDA's questions. Their queries seem reasonable enough: how many definitions are there for "middle of the night"? One man's middle is another man's dawn, so the potential for safety issues is there if users double-dose or take the drug too close to morning. Intermezzo is a low dose of zolpidem tartrate, the same chemical as in Ambien, so possibly there are data available from that drug's use and safety profile that might help here.
Transcept will work hard to respond comprehensively and accurately to FDA. Shareholders and Purdue will be watching closely; meanwhile those that suffer from middle of night insomnia might just have to wonder about persevering with low dose Ambien until Intermezzo comes along.
