Journey Medical (DERM.O) announced on Monday that its drug, Emrosi, has been approved by the U.S. Food and Drug Administration (FDA) for the treatment of inflammatory lesions associated with rosacea, a long-term skin condition that causes chronic facial inflammation. The approval was granted after two successful late-stage clinical trials in which Emrosi met its primary endpoint with no significant safety concerns.
However, despite the positive approval, the company’s stock saw a nearly 14% drop in response to the FDA’s decision to approve the drug only for inflammation, rather than for its ability to treat erythema, or facial redness, a common symptom of rosacea. This distinction raised concerns for investors, particularly as the drug will not directly address one of the most visible and distressing aspects of the condition.
Claude Maraoui, CEO of Journey Medical, explained to Reuters that the FDA was cautious about the potential confusion among healthcare providers due to the prevalence of erythema across various types of rosacea. While Emrosi will treat the inflammatory lesions, it will not be marketed as a solution for redness reduction, which had been a key expectation among some investors.
The approval places Emrosi in competition with Galderma’s Oracea, an oral doxycycline capsule that is currently the standard treatment for inflammatory rosacea lesions. Although the two drugs share a similar mechanism of action, B. Riley Securities analyst Kalpit Patel noted that investors were likely hoping for a broader indication, particularly for erythema, which would have provided a distinct advantage over Oracea.
Journey Medical expects Emrosi to become commercially available to U.S. patients by late Q1 or early Q2 of 2025. The company has not yet disclosed the drug’s price but indicated that it will be priced similarly to Oracea, which costs approximately $950 per month.
Patel projects that Emrosi could capture up to 50% of Oracea’s market share and generate sales of at least $150 million at peak. However, the future market performance of Emrosi will depend heavily on its ability to differentiate itself in the competitive rosacea treatment landscape.
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