Columbia Laboratories' gel for reducing the risk of premature birth did not work for U.S. women, U.S. health reviewers said on Tuesday, sending company shares tumbling more than 50 percent.
The Food and Drug Administration reviewers said the gel's efficacy was "a major concern" and asked an advisory panel to consider whether the company should conduct more U.S. clinical trials.
Shares of Watson Pharmaceuticals, which is developing the drug with Columbia, fell 5 percent.
The vaginal gel, which contains the hormone progesterone, is meant for women with a short cervix, who have a higher risk of premature birth.
Preterm birth affects 10 to 12 percent of all pregnancies in the United States, and babies born early have a higher risk of early death and long-term health and developmental problems.
The reviewers' comments were posted on the FDA's website on Tuesday. An FDA panel of outside experts will vote on whether the agency should approve the drug on Friday, and the FDA will make a final decision by February 26.
Last year, Columbia and Watson said that in trials, their gel helped cut the risk of premature birth by almost 45 percent for women worldwide.
But the FDA staff said the drug's efficacy for U.S. women was not statistically significant. The staff also said the overall trial results may have been influenced by the drug's success in countries such as Belarus and South Africa.
The FDA staff said patients treated with the gel did not have a higher rate of side effects than patients using a placebo.
If approved, the Prochieve gel would compete with a similar drug called Makena from K-V Pharmaceutical Co.
Columbia shares have been particularly volatile over the past year. They are down more than 70 percent from a high of $4.31 last April.
On Thursday, they fell 55.4 percent to $1.33 on the Nasdaq in afternoon trading. Shares of Watson fell 5.4 percent to $58.82 on the New York Stock Exchange.
(Reporting by Anna Yukhananovp; editing by John Wallace)