Futura Medical hails positive regulatory momentum

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What it does

Futura Medical PLC (LON:FUM) has created a technology called DermaSys that delivers active pharmaceuticals through the skin barrier rapidly and effectively.

In the case of its lead product the payload was glyceryl trinitrate (GTN), normally used to treat heart failure and high blood pressure. Futura combined the two to create a rapid onset gel that tackled erectile dysfunction (ED).

It is estimated that at least half of men with ED do not consult a doctor and, therefore, are not prescribed treatment. At the same time, pills such as Viagra and Cialis are not widely available over the counter. The UK is one of the few exceptions with Viagra Connect.

Medical device

Why as a medical device? Well, the results from DermaSys-only cohort showed the men involved responded to a mechanical and physical effect rather than to the chemical substance GTN.

That mechanical and physical effect on the body means DermaSys conforms to the definition of a medical device rather than a drug.

 

How it is doing

March 2021 saw Futura achieve two breakthroughs with regulatory bodies that sent the share price into orbit.

The company agreed with the US Food and Drug Administration (FDA) on the protocol for a small confirmatory clinical study of MED3000. The study, dubbed FM71, will be conducted prior to formal regulatory submission for Futura’s erectile dysfunction gel treatment as a DeNovo Medical Device. The study is primarily to make sure that the gel’s efficacy, which was proven in a previous study to work over three months of use, does not tail off after three months.

In Europe, the EU is to certificate Futura’s MED3000 as a Class 2B approved medical device.

Once the certificate is received, Futura’s topical gel formulation MED3000 will become the first pan-European topical treatment for erectile dysfunction available without the need for a doctor’s prescription.

Also in March, Futura inked an agreement with Co-High, a private equity company, which will help develop and roll out the company’s MED3000 gel in China and South East Asia.

Co-High, with its local partners, will be responsible for development and approval costs, which are estimated in the region of £4mln. Futura would get 50% of the profits generated.

It also secured a financing agreement to get up to £2mln from the HT Riverwood Multi-Growth Fund, £1.5mln of which it has already received.

The financing was done in two tranches – a loan note that converts within three years at 20p a share (a premium to the current price of just under 17p); and the issue of 2.27mln warrants exercisable at 22p.

Futura expects to receive EU approval for MED3000 this year.

 

 

What the boss says: James Barder, chief executive

“The recommendation to approve MED3000 in Europe is a huge milestone for Futura in the development of MED3000. We look forward with excitement to bringing MED3000 to patients in Europe as the first, clinically proven treatment for erectile dysfunction that is highly differentiated with its rapid speed of onset. Once the certificate is issued, MED3000 may be marketed throughout the EU without the need of a doctor’s prescription subject to any national marketing restrictions. This will represent a significant commercial opportunity,” said James Barder, the chief executive of Futura Medical.

“These key milestones are indicative of the rapid progress we have made in the last few months on our journey to fully commercialise MED3000,” Barder said.

 

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What the broker says

Liberum Capital Markets, which has a ‘buy’ rating and a 68p target price for the shares, said the minutes from Futura’s meetings with the FDA “provide a clear pathway for Futura to start work on a small confirmatory study”.

“The US opportunity is worth at least twice that of the European opportunity where Futura received confirmation of approval (due by the end of May) last Friday. Today’s announcement removes the uncertainty around the clinical trial structure for the US and adds to the significant momentum at Futura,” the broker said.

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