Just after the market closed on Friday, PTC Therapeutics put out a release stating that it is considering jerking its Duchenne muscular dystrophy drug Translarna (ataluren) from the German pharma ordering system after a setback during arbitration talks. But investors had already caught wind of the latest problem at the beleaguered PTC, and the biotech's battered stock ($PTCT) plunged 30% before the market closed.
PTC had earlier been pummeled by the news on Tuesday that the FDA had refused to accept its application for ataluren for review. While no cause for the rejection was given, the RTF highlighted PTC's failed Phase III study for the drug, which had been designed specifically to account for a failed Phase IIb study. Coming on the heels of harsh reviews for BioMarin ($BMRN) and Sarepta ($SRPT), the FDA's response seemed to signal a complete rout on the Duchenne MD front.
The FDA's action raised fresh questions about the fate of ataluren in Europe. Given a conditional approved for the EU in the summer of 2014, Germany and a number of other countries worked out access to the drug. Now regulators in Europe tell FierceBiotech that they are aware of the Phase III flop and will reconsider the accelerated approval, though no timeline has been announced.
In Germany, an arbitration board reduced the reimbursed price of the drug by 65%, according to a report from Adam Feuerstein at TheStreet. PTC's statement noted that it could continue to provide the drug to patients under a reimbursed importation pathway provided by German law.
The FDA can issue an RTF for a number of reasons, ranging from a gap in the data to small, technical issues that can often be addressed quickly. But PTC has been largely uncommunicative about the reasons for the FDA refusal, raising fears that it faces a worst case scenario that could prevent the drug from reaching the market for a long period, at best.
The situation has now burned away more than 70% of PTC's market cap in an unforgiving exchange, where biotechs with bad news--or even hints of disruption--are subjected to a beating. Analysts have been debating over whether the Europeans will retaliate and pull their approval, eliminating the only drug on the market for Duchenne. RBC's Simos Simeonidis has called it a "coin toss," while expecting a rejection on Sarapta's eteplirsen in the wake of its rejection of BioMarin's drisapersen.
- here's the release