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PAH franchise and cost cutting prevent Actelion from listing further

Authored by Karl Simpson

Back in 2011, Elliott Advisors, a shareholder in Actelion, tried to mount a boardroom coup to unseat the CEO and install its own management. At the time they cited questions over the Company’s strategy and governance after Actelion suffered a series of setbacks with their development pipeline.

The coup failed after the company selected new board members, including ex-GSK CEO JP Garnier. Two years on and Jean-Paul Clozel, who is CEO but also co-founder with his wife, is still at the helm of the company and has prevented it from further listing through some aggressive cost cutting and a pulmonary arterial hypertension (PAH) franchise which continues to perform. In its recent result announcement, the company stated it receives nearly 90% of sales from its sales of Tracleer for the rare disease. Pulmonary arterial hypertension is an incurable disease which leads to high blood pressure in the arteries of the lungs. Actelion’s Tracleer is one of the few approved drugs used in therapy for the treatment of pulmonary arterial hypertension despite many other companies having pursued R&D programmes for new therapies. In the second quarter of 2013, sales of Tracleer grew to 391.9 million swiss francs.

The company hopes to get the nod from the US FDA later this year for the new product, Opsumit, addressing PAH. Opsumit is a novel dual endothelin receptor antagonist (ERA) that resulted from a tailored drug discovery process with the target to develop an ERA optimized for efficacy and safety and if approved will provide a new treatment option for patients living with the rare disorder. Like most rare diseases, patients can often go on for many years without correct diagnosis and the incidence levels are low. Approval of Opsumit would be another very positive boost for Actelion who have managed to restore a lot of value in the company over the recent months, which is a far cry from the public spat of 2011.

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