Summary
- Trevena is preparing to resubmit its NDA for oliceridine on Q1 2020.
- Touted as a substitute for morphine, oliceridine faces a much smaller addressable market due to the ubiquitous nature of the former .
- The stock has declined significantly however considering the risks and smaller TAM there may not be that much upside.
Trevena (TRVN) is a biopharmaceutical company focused on developing targets and treatments for diseases affecting the central nervous system and pain relief. The main drug the company is developing is called oliceridine a mu-opioid receptor for the management of moderate-to-severe acute pain in hospitals. The company is hoping that oliceridine will replace intravenous administration of opioids drugs, the most common of which is morphine.
For the benefit of those who are unfamiliar with this company, this is just a brief history of the company's application for oliceridine so far. The company has completed a series of Phase 3 studies (APOLLO 1&2 on efficacy and ATHENA for a wide range of procedures) and submitted an NDA in 2017. An AdCom voted 8-7 against approval, and on November 2018, the FDA issued a CRL requesting additional clinical data and indicated that the submitted safety database was not of adequate size for the proposed labeling.
On January 2019, the company announced that the FDA had agreed to support a labeling at a maximum daily dose of 27 mg. The FDA also agreed to certain conditions and data to the follow-up study that Trevena will conduct in order to resubmit the NDA for oliceridine in Q1 2020. Apart from oliceridine the company also has 3 other drugs in its pipeline namely TRV250 (for the treatment of acute migraine), TRV734 (acute and chronic pain, and maintenance therapy for patients with opioid use disorder) and a non-opioid approach to managing chronic pain.
Source: Trevena November 2019 presentation
Morphine market is large and well-established
Invented in the 1800s, morphine has become ubiquitous in hospitals worldwide. Morphine is used primarily to treat both acute and chronic severe pain. It is on the World Health Organization's List of Essential Medicines i.e. the most effective and safe medicines needed in a health system. Morphine is available in various forms such as oral tablets, injections/IV and capsules.
The global opioids market size was valued at USD 25.4 billion in 2018 and is projected to expand at a CAGR of 1.8% during the forecast period. Increasing prevalence of diseases that cause chronic pain, such as cancer, postsurgical pain, lower back pain, fibromyalgia, and arthritis, is driving the market. The global medical morphine market size was valued at USD 10.75 billion in 2016. Using the CAGR of 1.8% from the opioid market we can arrive at a rough estimate of the morphine market for the next 5 years ending 2024 of $12 billion. Assuming 25% of the total market is for IV, which gives us a TAM for IV morphine of roughly $3 billion.
Source: Global Medical Morphine Revenue - Medical Morphine Market Size & Share, 2014-2024 | Industry Report (purchase required)
