Shares of Navidea Biopharmaceuticals (NYSEAMEX:NAVB) went tumbling in after-hours Monday when the company announced that the U.S. Food and Drug Administration did not approve its cancer diagnostic Lymphoseek.
Navidea received a complete response letter from the FDA, rather than approval, because of issues related to third-party manufacturing, the company said in a statement. The rejection was not because of anything to do with efficacy or safety data related to the drug, it said. Lymphoseek is a radioactive agent intended to help surgeons locate lymph nodes in the drainage path of primary tumors and target treatments for breast cancer and melanoma patients.
CEO Mark Pykett said in a statement that the company was working with the FDA to resolve the issues and remained confident in its clinical data supporting the value of Lymphoseek in identifying lymph nodes that most likely harbor cancer.
That’s tough news for a cash-burning company with a rocky past on the verge of a potential game-changing approval. Navidea had its NDA accepted in October of 2011 and in February opened a Boston-area commercialization office in preparation for the expected launch of the drug this year. Then, in April, the FDA pushed back its decision date for Lymphoseek, citing a need for more data related to chemistry and manufacturing. The company canceled presentations by its executives at upcoming investor conferences, including President and CEO Mark Pykett’s scheduled talk at the Rodman & Renshaw Annual Global Investment Conference today, to “focus on activities leading to the Lymphoseek NDA resubmission.”
Life Tech Capital analyst Stephen M. Dunn projected in a morning note (PDF) today that the FDA’s decision yesterday would delay Lymphoseek’s approval until the first quarter of 2013.
He wrote that the delay didn’t affect the firm’s 12- to 18-month price target of $5.75 and that it was still a recommended strong buy. Ladenburg Thalmann Financial Services also showed confidence, raising its price target in a report issued this morning.
“On $navb my exp tells me just b/c CMC is bad doesn’t = climical is ok. unless is says explicitly in the CRL clin is not auto-ok (ask mnkd),” tweeted Navidea critic Martin Shkreli, a New York hedge fund manager.
Here’s a roundup of some of the $NAVB chatter that’s been happening on Twitter, starting before the company’s announcement last night.
[Photo from Stuart Miles]