The FDA approves Bristol Myers Squibb's new schizophrenia drug

The U.S. Food and Drug Administration (FDA) on Thursday banned Bristol Myers Squibbs (BMY) the highly anticipated schizophrenia drug Cobenfy. It is the first novel treatment for the debilitating mental disorder in over seven decades.

Since the 1950s, all schizophrenia treatments have focused on targeting dopamine receptors. However, this approach has been associated with side effects such as sedation, weight gain, and motor impairment.

Cobenfy, the new drug from Bristol Myers Squibbconsists of two components. The first is xanomeline, a drug that activates muscarinic receptors in the brain to reduce dopamine activity without triggering the typical side effects of antipsychotics. The second component is trospium, which helps minimize gastrointestinal side effects associated with xanomeline, such as nausea, vomiting and diarrhea.

“Schizophrenia is a leading cause of disability worldwide,” Tiffany Farchione, director of the Division of Psychiatry in the FDA's Drug Center, said in a statement Press release. “This drug is the first new approach to treating schizophrenia in decades. This approval offers a new alternative to the antipsychotics previously prescribed to people with schizophrenia.”

The FDA approved Cobenfy after two Phase 3 trials. Over a five-week period, patients who took Cobenfy twice daily saw their Positive and Negative Syndrome Scale (PANSS) score – a scale used to assess symptom severity in people with schizophrenia and other psychotic disorders – decrease by about 21 points in comparison to a value of 12 points reduction in the placebo group.

The FDA warned Thursday that the drug should not be given to patients with liver dysfunction because of the risk of liver damage. Other possible side effects include urinary retention, increased heart rate, decreased digestion, and facial swelling. The most common side effects were nausea, indigestion, constipation, vomiting, high blood pressure, stomach pain, diarrhea, fast heartbeat, dizziness and acid reflux.

Approximately 1% of Americans suffer from the disease and, according to the FDA, it is one of the top 15 causes of disability worldwide. People with schizophrenia have a higher risk of dying at a younger age, and nearly 5% die by suicide.

The USA has introduced a nationwide Suicide and Crisis Lifeline in 2022. Anyone in crisis can call or text 988 or reach the crisis text line by texting TALK to 741741.

Cobenfy is expected to hit the market in late October with a list price of about $22,500 per year.

Analysts at William Blair expect Cobenfy could generate peak U.S. sales of about $2 billion by 2030 for the treatment of schizophrenia alone. However, if ongoing Phase 3 trials for additional indications, including Alzheimer's-related psychosis and concomitant schizophrenia, produce positive results, annual sales could be between $3 billion and $5 billion.

Bristol Myers Squibb shares are up over 2% since Friday morning.