Source – Verrica Pharmaceuticals
After facing two rejections from the FDA, both related to manufacturing issues, Verrica Pharmaceuticals has finally obtained approval for Ycanth, making it the first therapeutic to be sanctioned in the United States for molluscum, a viral skin infection.
Following the FDA’s thumbs up on Friday, Verrica revealed that it was in the process of finalizing a non-binding term sheet for up to $125 million in debt financing to support the launch of Ycanth, which is scheduled for late September.
However, despite the positive news, Verrica’s shares experienced a 30% decline from their Friday closing value following the Monday announcement of the loan.
This approval marks a significant milestone for Verrica Pharmaceuticals, a 10-year-old company based in West Chester, Pa., specializing in dermatology therapeutics for various skin diseases. Besides molluscum, the company is also exploring cantharidin as a treatment for genital warts and common warts.
Molluscum is a contagious condition that often goes under-diagnosed, affecting approximately 6 million individuals annually in the US, with the majority of cases occurring in children. The approved topical treatment targets patients aged 2 and older.
Molluscum is typically spread through skin-to-skin contact or contact with objects that carry the virus, such as toys or wet surfaces. It causes raised lesions that can lead to inflammation, itching, and bacterial infection. In some cases, these lesions can persist for years and may result in permanent scarring.
Verrica Pharmaceuticals estimates that only 15% of molluscum cases are currently diagnosed. However, the company’s CEO, Ted White, anticipates an increase in diagnoses now that an approved treatment is available. The company forecasts a potential market of 1 million patients per year.
The price for Ycanth has not been determined yet and is expected to be disclosed next month, according to Verrica’s CFO, Terry Kohler.
“We are proud to bring patients and caregivers the first FDA-approved treatment for molluscum, which is one of the largest unmet needs in medical dermatology. Verrica is the first company to develop a proprietary applicator and GMP-formulation of cantharidin that allows a safe, effective and precise topical administration, and the first company to successfully gain FDA approval after conducting rigorous clinical trials to evaluate the safe and effective use of a cantharidin-based product for the treatment of molluscum. We wish to express our gratitude to the approximately 500 patients and their caregivers who participated in the pivotal Phase III trials as well as the investigators and health care professionals at more than 30 clinical sites. Our commercial team is vigorously preparing for commercial launch, and we look forward to working with healthcare providers to give patients and caregivers access to Ycanth by September 2023.”
– Ted White, Verrica’s President and Chief Executive Officer
The FDA approval was based on two Phase III trials, which involved 518 patients and demonstrated that VP-102, the active ingredient in Ycanth, achieved 50% clearance of lesions compared to 15% for patients on a placebo treatment. The positive results were consistent across different age groups and lesion locations.
The approval process for Ycanth has been lengthy and challenging for Verrica, as the company faced complete response letters (CRLs) from the FDA in September 2021 and May 2022. Furthermore, Verrica’s contract manufacturer, Sterling Pharmaceuticals Services, was placed on official action indicated (OAI) status, the most severe category of violation, between the two rejections. In response, Verrica took action to address the manufacturing issues by working with Sterling and engaging another contract manufacturing organization to ensure a stable drug supply.
