What FDA Breakthrough Therapy Designation Means for Dyax

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Dyax Corp. (NASDAQ: DYAX) announced on Tuesday that the U.S. Food and Drug Administration (FDA) has granted a key breakthrough therapy designation for the investigation of DX-2930 for hereditary angioedema (HAE). This does come with special privilege from the FDA, but many investors and patients might not really know what this means.

According to HAE Hope, hereditary angioedema is a rare disease of the immune system that causes spontaneous swelling throughout the body. It only affects an estimated one in 50,000 people around the world (implying roughly 6,400 patients in the United States, based on a population of almost 320 million). HAE Hope also said that this angioedema is hereditary as a genetic defect that is passed through families — when a parent has HAE, there is a 50% chance that the child will inherit the disease.

Dyax is developing DX-2930 as an investigational fully human monoclonal antibody inhibitor of plasma kallikrein as a subcutaneous injection for prevention of HAE attacks. This designation was said to be supported by the interim results of Dyax’s Phase 1b clinical trial of DX-2930 in HAE patients. The Phase 1b study met all objectives assessing safety, tolerability and pharmacokinetics of multiple subcutaneous administrations of DX-2930. Additionally, in a pre-specified proof-of-concept efficacy analysis, DX-2930 demonstrated statistically significant reductions in attack rate compared to placebo.

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Here are some of the FDA benefits for breakthrough therapy designation:

  • Expedite the development and review of potential new medicines
  • Considered when preliminary clinical evidence indicates the drug may demonstrate substantial improvement over available therapy
  • Organizational commitment involving the FDA’s senior managers and with more intensive guidance

Still, the breakthrough therapy designation is said to not change the standards for approval.

Dyax had annual sales of $81.7 million in 2014. Thomson Reuters has consensus estimates of $94.4 million in 2015 and $116.6 million in 2016. Unfortunately, Dyax is expected to keep losing money. As of March 31, 2015, Dyax had close to $182 million between its cash and short-term investments.

Dyax has a market cap of roughly $4 billion. At $27.30 after a 2.5% gain on Tuesday, Dyax has a 52-week trading range of $8.09 to $30.55 and a consensus price target of $29.75.