UPDATE 3-OraSure says FDA seeks more study on hepatitis C test

Thu Jun 25, 2009 12:47pm EDT
 
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* Says to conduct additional testing, trial of HCV test

* Sees $3 mln charge

* Says facing problems in manufacturing rapid HIV test

* Says advisory committee to review OTC HIV test study

* Shares down about 27 pct (Adds analysts' comments, updates share movement)

By Anand Basu

BANGALORE, June 25 (Reuters) - OraSure Technologies Inc (OSUR.O) said U.S. health regulators asked it to conduct an additional study of its hepatitis C virus (HCV) test on concerns of potential bias in data interpretation, delaying the test's marketing approval.

OraSure also said it is facing difficulty in resuming full-scale production of its rapid HIV test and that it would require an advisory committee to review results related to its over-the-counter (OTC) HIV test.

Shares of the company were down 24 percent at $2.49 in midday trade Thursday, making them one of the top percentage losers on Nasdaq. They touched a low of $2.41 earlier in the session.

"I think that the most disappointing part is hepatitis C (test delay) as that was the near-term catalyst for the stock," Wm Smith Securities analyst Aaron Lindberg said by phone.

The U.S. Food and Drug Administration indicated that clinical data related to the HCV test could have been biased because the same operators performed the test and interpreted results on multiple specimen types derived from the same patient, the company said.

In October, OraSure filed a premarket approval application (PMA) for its OraQuick HCV test for use with multiple specimen types, including venous whole blood, fingerstick whole blood, oral fluid and other sample types.

"The FDA has changed the rules in the middle of the PMA process, requiring new studies that will likely delay approval of the device for at least another year," Susquehanna Financial Group analyst David Turkaly wrote in a note to clients.

Turkaly downgraded OraSure to "neutral" from "positive."

OraSure had expected to address the FDA's concerns without material impact to the clinical program.

However, the FDA recently concluded that additional clinical testing will be required to obtain approval of the PMA for a venous whole blood claim, the company said.  Continued...