Natesto could be the product that turns Aytu profitable. Testosterone replacement treatment is big opportunity for Colorado company
An Englewood specialty pharmaceutical company projects big revenue growth in the next year driven by U.S. sales of a testosterone replacement nasal spray.
Aytu BioScience Inc. this week announced its plan launch sales of its Natesto compound in the U.S., targeting a $2.4 billion market for mens’ testosterone replacement therapies, primariliy through urology clinics nationwide.
“We have completed our expansion and are ready to launch Natesto in the field,” said Josh Disbrow, CEO of Aytu, on a conference call about the product launch. “It’s quite rare for a company of Aytu’s size to have an opportunity of this scale ahead of it.”
The company isn’t projecting how much sales revenue it expects from Natesto sales, but there’s potential for as much as $100 million if the company can execute well on its sales plan.
Aytu has historically lost money and has $7 million in annual expenses. Natesto could be the product that turns Aytu profitable.
“I don’t know how long it will take us to get there, but it’ll feel good when we do,” Disbrow said. “We believe we’ve got a near-term path.”
An estimated 13 million men in the U.S. are candidates to treat low testosterone, or ‘low t,’ caused by hypogonadism.
Natesto is the only U.S. Food and Drug Administration-approved testosterone replacement delivered in a nasal spray, which Aytu believes will become a preferred ‘low t’ treatment because of its convenience and simple delivery.
Aytu paid $4 million up front for in its winning bid for North American rights to sell Natesto, a license sold by Canada’s Acerus Pharmaceuticals. Aytu beat out other bidders in late April.
Malvern, Pennsylvania-based Endo Pharmaceuticals had held rights to sell Natesto in the U.S., but it didn't succeed and gave the rights back to Acerus.
As a nasal spray, Natesto doesn’t carry an FDA “black box” warning for risks of transferring testosterone — and possible induced male traits — to others in their family, which is something considered a risk of competing testosterone gels and ointments.
FDA regulators on June 30 rejected Lipocine’s oral testerone replacement drug, suggesting there won’t be other novel ‘low t’ products coming to market now.
“Natesto is really the only new game in town,” for testosterone replacement, Disbrow said. He noted the product has no clinical trial risk. “This is an ideal scenario for a company like Aytu.”
Aytu has added a nationwide sale force to prepare to introduce Natesto to U.S. doctors. It has not disclosed how many sales people it has ready to launch Natesto, saying it’s less than 100 people but is present in every major metropolitan area in the U.S.
The strategy is to get Natesto in front of the 5,500 doctors who write the highest volume of prescriptions for “low t” treatments. An estimated 1,200 urologists write 430,000 prescriptions for testosterone replacement therapy annually in the U.S.
Aytu recently acquired other revenue-generating products ProScint, a prostate cancer detection device, and oral medicine Primsol, which treats urinary tract infections
Product revenues rose 42 percent quarter-over-quarter for Aytu before Natesto. The company doesn’t expect to start seeing revenue from sales until after its current quarter is complete.
Aytu sales teams are slated to start actively promoting Natesto to clinics at the end of July and making sales calls Aug. 1.
SOURCE:https://www.bizjournals.com/denver/blog/boosters_bits/2016/07/testosterone-replacement-treatment-presents-big.html