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Pacira's New Steps to Pain Treatment

03/25/2019 5:00 am EST

Focus: HEALTHCARE

John McCamant

Editor, Medical Technology Stock Letter

Pacira Pharmaceuticals (PCRX) recently acquired MyoScience which markets the Iovera system, an FDA approved non-opioid treatment for pain using focused cold therapy, notes biotech expert John McCamant, editor of The Medical Technology Stock Letter.

Pacira will make an initial payment of $120 million and up to $100 million in contingent payments. Iovera is not a drug, but a medical device that freezes nerves through cryoneurolysis and delivers pain relief. The iovera System is FDA-cleared to relieve pain and symptoms associated with osteoarthritis of the knee for up to 90 days.

According to the Company, results can be felt immediately after Iovera treatment with pain relief that can last three months, and in some cases longer, as the nerve regenerates over time. 

As a non-opioid pain treatment for a large market, Iovera will be added to the Pacira product lineup that addresses the opioid crisis. It will also be added to the distribution network of the pain management joint venture with Johnson & Johnson (JNJ). 

The initial market response was negative as the deal might remove any takeover speculation left in PCRX (it hasn’t been a rumored candidate for sometime), but shares have recovered since. We do not know much about Iovera, but PCRX management is among the most knowledgable in the therapeutic field.

The company also presented new data showing that a patient-optimizing, opioid-sparing enhanced recovery after surgery (ERAS) pathway, which includes intra-operative infiltration with EXPAREL, results in high rates of early discharge and patient satisfaction among Medicare-insured patients undergoing total knee or hip arthroplasty (TKA or THA).

Findings also demonstrate that the vast majority of patients do not require more than a 7-day opioid prescription following discharge. The research was detailed during a podium presentation at the American Academy of Orthopaedic Surgeons (AAOS) 2019 Annual Meeting in Las Vegas.

Retrospective chart review data were captured for 645 consecutive Medicare patients who underwent primary inpatient TKA (337 patients) or THA (308 patients) between June 1, 2015, and November 16, 2017. All patients followed a procedure-specific ERAS protocol; key findings included:

• 84% of patients were same-day discharged to home, without home services, following their joint replacement

• 84.2% did not require any additional opioid prescriptions beyond the initial 7-day prescription provided at discharge

This is a huge improvement as the current percentages are 38% of knee replacement patients that are still taking opioids 2 months after surgery.  In our view, the difference between one week and two months is substantial and certainly has the potential to reduce opioid use which results in less people becoming addicted. 

Research has clearly shown that the substantial increase in middle class opioid/heroin addicts usually starts with legal prescribed opioids.   Thus, new pain treatment options such as those offered by Pacira should continue to grow. 

The firm's management team has historically worked hard to demonstrate the value proposition that EXPAREL brings to pain management.  Strong data is important as it helps prescribers fully appreciate the benefits of EXPAREL. The stock is a buy under $40 with a target price of $55.

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