AcelRx stock plunges after FDA rejects pain drug device
(Reuters) - Shares of AcelRx Pharmaceuticals Inc plunged almost 40 percent after the U.S. Food and Drug Administration rejected its pain treatment late on Friday.
The rejection also reduces the lead the drug device, Zalviso, was likely to have over a rival from Medicines Company, which was submitted for approval in late June.
Analysts, who were surprised by the decision, said the issues cited by the FDA were "rather mild" and expected Zalviso to eventually receive approval.
The FDA in its complete response letter (CRL) sought more data to ensure proper use of the device but did not ask for additional human clinical trials.
"ACRX was surprised to receive a CRL for issues it believes could have been resolved with a routine (review) PDUFA delay; almost exclusively straightforward device/instruction issues rather than drug concerns," JMP analyst Oren Livnat wrote, maintaining his "market outperform" rating on the stock.
AcelRx said it would resubmit its application by the end of the year, pending further discussions with the FDA.
Roth Capital Partners, Mizuho Securities and JMP Securities analysts said the rejection would likely result in a one-year delay to approval.
Zalviso and Medicines', Ionsys, are designed for the management of pain in a hospital setting.
"Assuming a first-pass approval, Ionsys now appears to have at least a 2-month head start on Zalviso," Roth Capital Partners analyst Ed Arce said, cutting his price target on the AcelRx stock to $16 from $22.
RBC Capital Markets analysts reduced their 2021 U.S. sales forecast for Zalviso by $50 million to $350 million.
Zalviso, consists of sufentanil, an opioid, and is delivered using AcelRx's flagship NanoTab technology that enables rapid absorption when placed under the tongue.
If approved, it will mark the first time that sufentanil, which is usually injected, becomes available for oral administration.
An application to market Zalviso in Europe was submitted by the company's German partner Grunenthal Group earlier in July.
The product is also undergoing development for use in breakthrough pain in cancer patients, pain relief for patients undergoing procedures in a physician's office and acute pain.
The Redwood City, California-based specialty pharmaceutical company's stock was down about 38 percent at $6.68 in afternoon trade on the Nasdaq on Monday.
The stock was the biggest percentage loser on the exchange, with nearly 8.4 million shares changing hands by 1200 ET - more than 10 times their 50-day average.
(Reporting by Natalie Grover in Bangalore; Editing by Saumyadeb Chakrabarty and Sriraj Kalluvila)
- Exclusive: Angry with Washington, 1 in 4 Americans open to secession
- Scots spurn independence in historic vote, nationalist leader resigns |
- Eight bodies found after attack on Guinea Ebola education team
- Special Report: Scotland stays in UK, but Britain faces change
- Alibaba expected to rise more than 30 percent in trading debut |