Timing of Intersect ENT’s approval is on the nose

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With one medtech focused on nasal devices having been taken out last week, this is an interesting time for Intersect ENT, another such company, to secure a US approval. Intriguingly the product in question, a sinus implant designed to treat nasal polyps, is regulated as a drug rather than a device.

That might not put potential acquirers off. But they may wish they had moved earlier: Intersect’s share price is up 14% on yesterday’s approval. Stryker, which bought Entellus Medical on Thursday, might almost be reproaching itself for buying the wrong company.

Intersect’s device, Sinuva, is made of bioabsorbable polymer and elutes the corticosteroid mometasone furoate for three months after it is implanted in the sinus cavity via the nose. The implanting procedure is done in a doctor’s office. The FDA has approved it for recurrent nasal polyp disease in patients who have previously had ethmoid sinus surgery.

Intersect ENT’s Sinuva implant.

The doctor can remove Sinuva at any time. He or she must also inform the patient that as the implant softens and polyps decrease, the product may be expelled out of the nose on its own or with actions such as sneezing or forceful nose blowing.

Price

The product seems to be effective, having hit the co-primary endpoints in its pivotal study, Resolve II. That study randomised 300 patients to either bilateral implant placement or a sham procedure; both groups also used mometasone furoate 200μg nasal spray once daily.

The Sinuva-treated patients had a significantly greater reduction in polyp grade from baseline compared with the sham group, and a significantly greater reduction in mean nasal obstruction/congestion score.

Patients who have already had one surgery for polyps have few options for subsequent treatment: more surgery, or high doses of anti-inflammatory drugs, either intranasal or oral. Since anti-inflammatories are the initial treatment, even before the first surgery, patients often opt to undergo a second procedure.

The success of Sinuva relies on Intersect convincing doctors that it can take the place of this repeat procedure. Since nasal polyp surgery is done endoscopically on an outpatient basis – much cheaper than operations that require a hospital stay – the company will  have to price the implant carefully to maintain its appeal to payers.

Sinuva is forecast to be Intersect’s bestselling product in 2022, with sales of $77m, EvaluateMedTech data show. The company’s total sales are forecast at $241m that same year.

Intersect ENT
WW annual sales ($m)
Segment   (Company) 2016 2018e 2020e 2022e CAGR
In-Office/ Non Surgical Sinuva - 5 31 77 N/A
In-Office/ Non Surgical Propel Contour (non-surgical) - 0 1 2 N/A
Surgical Propel 30 38 44 46 +7%
Surgical Propel Mini (ethmoid) 29 32 39 42 +6%
Surgical Propel Mini (frontal) 19 18 20 21 +2%
Surgical Propel Contour (frontal) - 3 7 8 N/A
Surgical Propel Contour (maxillary) 0 14 29 45 +177%
Total company revenues 79 112 171 241 +20%
Source: EvaluateMedTech

Yet Intersect’s market cap currently sits at $965m – its stock having risen 170% across 2017 so far. If potential acquirers were waiting for the Sinuva approval to de-risk the company, they might find they have waited too long.

To contact the writer of this story email Elizabeth Cairns in London at elizabethc@epvantage.com or follow @LizVantage on Twitter

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