Vernalis falls after FDA knocks back cough-cold drug filing

London Stock Exchange
Vernalis' stock price fell after FDA issued a CRL for CCP-07.

The FDA has knocked back Vernalis’ filing for approval of CCP-07. The setback wiped 12% off Vernalis’ stock price in early trading as investors weighed the impact of the at-best-delayed approval of a cough-cold drug projected to generate peak sales of $150 million (€140 million) to $500 million.

Vernalis said the complete response letter “did not raise any concerns with the formulation or pharmacokinetic profile of CCP-07 but did identify outstanding items that need to be addressed prior to the resubmission and approval of the NDA.” The PDUFA date for the application was April 20, the day before Vernalis revealed FDA had questions about the filing that couldn’t be answered within the review period.

That forces Vernalis to go away to prepare and submit a revised NDA that answers the regulator’s outstanding questions. Vernalis is yet to commit to a timeline for filing the NDA but has signalled its intent to do so.

"We remain committed to the approval of CCP-07 and will work closely with the FDA to resubmit the NDA as quickly as possible" Vernalis CEO Ian Garland said in a statement. Regardless of how fast Vernalis works, the knockback means CCP-07 won’t be on the market in time for the 2017-18 cough-cold season.

Vernalis sought the approval on the strength of a pivotal multiple-dose comparative bioavailability study it wrapped up 12 months ago, plus 12-month stability tests. Shortly after completing the bioavailability study, Vernalis raised £40 million to fund the commercialization of CCP-07 and work on other approved and experimental products. That financing increased Neil Woodford’s stake in Vernalis to above 25%.

Woodford and Vernalis’ other backers had hoped the CCP-07 PDUFA date would bring the first of two 2017 approvals. The second NDA, for CCP-08, is scheduled for the first week of August.

Both drugs emerged from a deal Vernalis struck in 2012 with Tris Pharma. The agreement gave Vernalis the exclusive right to use Tris’ extended-release technology in the U.S. prescription drug cough-cold market. Vernalis made a $3 million milestone payment to Tris when FDA accepted the NDA but will have to wait a little longer before it can start to recoup the outlay.

Vernalis pocketed a milestone of its own on the day it disclosed the setback to CCP-07. The $2 million payment stemmed from a research collaboration that is using Vernalis’ drug discovery platform.