(Bloomberg) – The Food and Drug Administration’s rejection of some drugs that Wall Street expected by sailing through regulators raised concerns that other upcoming drug decisions could face a similar fate.
Commitment to the treatment of rheumatoid arthritis from Galapagos NV and Gilead Sciences Inc. and the haemophilia of BioMarin Pharmaceutical Inc. A gene therapy turned up the heat for investors in biotechnology betting on companies with key decisions in the coming months. Shares fell when Biogen Inc.’s experimental drug for Alzheimer’s disease and drugs from Bristol Myers Squibb Co. acquired from Celgene Corp. were seen among those at risk.
“I get the question a lot about how the FDA has been so flexible to recent history and they’re coming to a turning point where they’re rejecting applications more freely,” Baird analyst Brian Skorney said by phone. Without seeing the agency’s communications with companies, “it’s hard to tell” how much reading there can be for other drugs being controlled, he said.
Biogen fell 2.8% on Wednesday, also awaiting news of new generic competition for its multiple sclerosis medication. That puts even more pressure on aducanumab, an experimental therapy for Alzheimer’s that has a March 7 FDA decision deadline.
The Bristol Myers lysocabtagene maraleucel has a target date of November 16 in large B cell lymphoma and its application with partner Bluebird Bio Inc. for idecabtagene vicleucel in multiple myeloma was resubmitted to U.S. regulators last month. Approval of liso-cell by 31 dec. And ide-cell by March 31 would mean a payout of $ 9 for holders of the conditional value issued in the Celgene deal. Shares of the CVR fell as much as 2% to $ 2.88 on Wednesday.
Jared Holz, a health care strategist at Jefferies, said he did not think Gilead’s and BioMarin’s deployments suggested “any kind of change as a trend from the sea regarding how the FDA handles this drug approval.” The agency is seeking more data on both drugs, which analysts expect will delay approval by about a year for Gilead and Galapagos and closer to two years for BioMarin.
In the case of BioMarin, Holz said the availability of other drugs to treat hemophilia could give the FDA more room to take things slow. The agency may also signal a higher bar for approval in the new class of drugs, known as gene therapies, he said.
For Biogen, the lack of approved treatments in Alzheimer’s could prove an important differentiator when it comes time for the FDA decision. Bristol-Myers’ liso cell and ide cell would compete with old and new drugs.
Other recent signals that the FDA may grow more cautious include a New York Times report that the agency has the authorization for blood plasma as a Covid-19 treatment on hold because it is waiting for more data.
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