(Reuters) - The U.S. Food and Drug Administration pushed back its deadline to decide on drug developer BioMarin Pharmaceutical Inc’s lead drug, not rejecting it outright, making shareholders optimistic.
On Friday, the company announced the delay from the FDA, saying the federal agency had not yet completed the review of the drug, which is designed to treat rare disorder Duchenne muscular dystrophy (DMD).
The FDA was set to decide on the approval by Dec. 27, and the agency anticipates giving its decision in early January, the company said on Friday.
Shares of the company rose as much as 4.3 percent to $105 before giving up some of its gains to trade up 3.2 percent at $103.84 in afternoon trading.
Analysts from Wedbush Securities, Raymond James and Evercore ISI were of the opinion that the lack of an outright rejection could mean a higher chance of the drug being approved, in light of a strongly-worded review by FDA staff and a panel of outside experts made earlier.
Data submitted by the company from studies did not persuade a panel of outside advisers to the FDA last month that the drug worked in DMD patients.
RBC Capital’s Michael Yee thought the delay would not change the chances that the drug would be rejected. “Fundamentally it does not materially change the consensus view on Wall Street that nearly fully expects an FDA rejection and institutional buy-side expectations are remarkably very low after a very cautious or concerned panel in November,” Yee said.
BioMarin’s DMD drug, to be named Kyndrisa on getting the FDA nod, was expected to be the first treatment for the muscle wastage disorder that affects one in 3,600 newborn boys and causes rapid muscle degeneration.
At the panel discussion in November, 15 out of 17 members were of the opinion that the lack of statistical significance in BioMarin’s late-stage study weakened the findings from two earlier studies.
FDA staff who pored over the company’s data raised concerns about the drug, including potentially fatal long-term side effects such as kidney problems and reduction in blood platelets.
BioMarin’s closest competitor Sarepta Therapeutics Inc’s experimental DMD drug, eteplirsen, which works in similar way, is also expected to face a tough review by FDA staff and a panel of experts.
Reporting by Vidya L Nathan in Bengaluru; Editing by Sriraj Kalluvila and Shounak Dasgupta