Although ARS Pharmaceuticals’ approval for its epinephrine nasal spray came later than expected, the company ultimately received a thumbs up from the FDA in August and is now moving fast to expand Neffy’s reach beyond the U.S.
On Monday, the California-based drugmaker said that Denmark’s ALK-Abelló is paying $145 million upfront for the rights to market Neffy in Europe, Canada and “other geographies outside of the U.S.” In Europe, where ARS’ needle-free EpiPen alternative was approved for emergency anaphylaxis treatment late this summer, the drug goes by the name EURneffy.
Apart from the commercial accord in Europe and Canada, ARS has already established Neffy marketing pacts in Japan, China, Australia and New Zealand with Alfresa, Pediatrix and CSL, respectively.
Under the latest deal, ARS is in line to receive up to $320 million in regulatory and sales milestones, plus tiered, double-digit royalties in the teens on net sales in places where ALK will market Neffy. ARS says it will remain in charge of manufacturing and supplying Neffy to ALK.
“ALK is a specialized pharmaceutical company and a global leader in the allergy field, serving millions of allergy patients across 46 countries,” ARS’ co-founder and CEO, Richard Lowenthal, said in a statement, calling ALK an “ideal” Neffy partner. “Additionally, the capital from this agreement enables us to focus fully on our ongoing U.S. commercial launch of Neffy, with significant operational flexibility.”
Given the recent approval of Neffy in Europe, ALK expects the first launches of the product to kick off in 2025 following the completion of market access negotiations, analysts at William Blair wrote in a note to clients Monday.
ARS, for its part, recently said it expects the product to launch in Germany first—as is typical of European drug rollouts—followed by the U.K. Together, those countries would make up roughly half of the Neffy market in Europe, the company told Leerink Partners in August.
According to William Blair, the European and Canadian markets for epinephrine devices are worth some $230 million combined, with ALK expressing confidence that Neffy could bring down more than $400 million in peak sales in its licensed territories.
“While that would represent a nice royalty stream to ARS, we believe this also highlights that ARS got a good deal here given the size of the upfront payment and ongoing economics,” the analysts said.
Further, ALK already sells the epinephrine autoinjector Jext in Europe and other areas, which makes it a “great partner” given its existing infrastructure to sell Neffy, the William Blair team added.
ARS had previously hoped to win FDA approval for Neffy in 2023 before the company was hit with a surprise Complete Response Letter. At the time, the FDA asked ARS to provide more study data on repeat doses of Neffy compared to repeat doses of injectable epinephrine for allergen-induced allergic rhinitis conditions.
Nevertheless, the drug ultimately did win U.S. approval in early August. Specifically, the FDA approved Neffy 2 mg for treatment of Type 1 allergic reactions, including anaphylaxis, in adults and kids who weigh at least 66 pounds.
The drug officially hit the U.S. market in late September, according to a recent release from ARS.
Over the summer, analysts at Leerink noted ARS had a “blue sky opportunity” on its hands with Neffy’s launch, citing comments from the company about Neffy’s potential widespread use among groups like airlines, emergency medical units and first responders.
ARS told Leerink that police officers and fire and rescue workers are unable to carry autoinjectors because of regulations against needle-based therapies, which could make Neffy an attractive alternative on par with something like the overdose reversal nasal spray Narcan.
As for Neffy’s performance since launch, the William Blair team wrote in its Monday note that the drug could “exceed current consensus expectations,” highlighting a survey that suggested “there should be meaningful demand for Neffy in the near term.”
“With Neffy being a clearly differentiated approved product, we anticipate a strong commercial launch and blockbuster peak sales,” the analysts added.