U.S. Food and Drug Administration (FDA) has sent a “Refuse to file” letter to Celgene with regards to the New Drug Application filed for Ozanimod drug for treating patients with relapsed multiple sclerosis.
The drug regulator cited a couple of data sections are inadequate. In response to the letter, the biotech giant would be meeting FDA officials for further clarification so that it can file the NDA again with the regulator.
In a conference call, Celgene (CELG) said that it looks forward to working with FDA and other global authorities to bring Ozanimod to patients as quickly as possible. With this reevaluation of Ozanimod, the company plans to reevaluate the other worldwide regulatory filings.
Generally, within pharma circles, refusal to file from FDA is viewed as an embarrassment, especially for a company’s stature like Celgene. This news doesn’t cut the teeth with the Street since there were high hopes pinned on Ozanimod being ready for commercial launch in second half of 2018.
Also, this drug is considered as a potential blockbuster drug with peak sales expected to come in the range of $4 billion to $6 billion per year. This rejection by FDA is seen as a big deterrent by the Street since the launch timeframe now could be pushed for months or years depending on various factors. Celgene’s stock plummeted 8% touching four-year low levels trading at $88 range.
Things don’t seem to be looking hunky-dory at the moment for Celgene. In October, it has abandoned a candidate for Crohn’s disease citing failures in Phase III trials. It has incurred charges to the tune of $1.6 billion as wind-down costs. The company and the Street were more upbeat about the launch of Ozanimod, which would help the firm to look beyond its cancer drug Revlimid for growth.
To put things in perspective, the company expects its 2018 sales to be in the range of $14.4 billion to $14.8 billion. Sales from Revlimid are expected to be around $9.4 billion. This means that the cancer drug alone is going to contribute 63% to Celgene’s top line.
Celgene has its work cut out to instill confidence in investors that there will not be any slip-ups from now on and the company’s growth prospects are intact.