FDA Grants Tentative Approval for AFT’s Scomara with US Launch Delayed

FDA Tentative Approval Confirms Regulatory Progress but US Launch Deferred

AFT Pharmaceuticals (ASX:AFP, NZX:AFT) has secured tentative approval from the US Food and Drug Administration for Scomara, a rapamycin 0.5% cream targeting Facial Angiofibromas in Tuberous Sclerosis Complex (FA in TSC). While this milestone validates the product’s quality, efficacy and safety profile, the US commercial launch is effectively on hold until March 22, 2029, due to an existing orphan drug exclusivity granted to a competitor in 2022.

Orphan exclusivity in the US grants seven years of market protection for treatments of rare diseases, preventing FDA approval of competing products for the same indication during that period. This exclusivity is a situation with both benefits and drawbacks for AFT, as it delays access to a sizeable US patient population estimated between 15,000 and 30,000 individuals.

Global Market Opportunities Outside US Offer Strategic Upside

Importantly, the US orphan exclusivity does not extend to several other significant markets including Canada, Australia, New Zealand, and many Asian countries where AFT operates directly or through partners. In these territories, the FDA’s tentative approval is expected to facilitate regulatory clearances, enabling earlier commercialisation.

AFT highlights Scomara’s competitive advantages over the incumbent orphan product: it requires only once-daily application and can be stored at ambient temperatures, whereas the existing treatment demands twice-daily dosing and refrigeration. These factors could translate into better patient adherence and convenience, potentially strengthening Scomara’s market position.

Financial Impact and Profit Sharing Structure

Reflecting the US launch delay, AFT has not included any revenue from Scomara in its FY27 forecasts. The company stands to earn a 65% share of worldwide profits from the medicine after recouping development costs, with the remaining 35% accruing to its partner AFT Orphan Pharmaceuticals. Additionally, AFT receives royalties for the use of its proprietary technology embedded in the product, payable prior to profit sharing.

Managing Director Dr Hartley Atkinson expressed satisfaction with the regulatory progress despite the US delay, noting the tentative approval acts as a catalyst for developing new markets outside the US. This aligns with AFT’s broader strategy of expanding its global footprint across multiple therapeutic areas and geographies, building on recent revenue growth and R&D investments.

Positioning Amidst Recent Growth and Pipeline Advances

This regulatory update comes on the back of AFT’s strong FY26 performance, which included a 22% revenue increase to NZ$254.7 million and record operating profit, driven by international expansion and a deepening product pipeline. The company is targeting over NZ$300 million in revenue for FY27, supported by ongoing R&D and new product launches across its markets.

While the US market remains a lucrative but temporarily inaccessible opportunity for Scomara, the product’s approval status strengthens AFT’s position in other regions. Investors will be watching how quickly AFT can capitalise on these markets and whether regulatory approvals outside the US can translate into meaningful sales ahead of the 2029 US launch window.