AcelRx shares plunge after FDA rejects its pain drug/device system

Shares of AcelRx took a painful 30% plunge on Monday morning as investors got a chance to respond to the biotech's announcement late Friday night that the FDA had rejected its application for Zalviso, its sufentanil sublingual microtablet drug/device system for fighting pain.

Right now AcelRx's ($ACRX) standing with the FDA is a little murky. According to the biotech, the FDA wants to see more bench data related to errors using the system, changes in operating instructions and "additional data to support the shelf life of the product." Some of that additional info may have already been filed with the FDA, according to the Redwood City, CA-based company, but some added work will be needed as well.

"Additional bench testing will be required and human factors testing may be required to address certain items in the CRL," the company noted in its statement. "There were no requests to conduct additional human clinical studies."

That may make a quick U-turn to the FDA possible with the drug/device combination.

AcelRx CEO Richard King

"We believe we can satisfy all of FDA's requests in the CRL and resubmit the NDA by the end of 2014, although we will have more clarity on the process and timing after our conversation with FDA," said Richard King, president and CEO of AcelRx. "We are confident in the Zalviso development program and will work closely with the FDA to address the Agency's concerns as outlined in the CRL to ensure that healthcare professionals and patient communities will have access to Zalviso."

Zalviso is being billed as an easier and safer method for allowing hospital patients to self-dose using a sublingual microtablet of the opioid sufentanil, replacing IV systems now in use. The system would be marketed as an improvement over IV methods now used in hospitals

The setback is also bad news for Germany's Grunenthal, which paid $30 million upfront and promised up to $220 million more last fall as it licensed European and Australian rights to the pain therapy.

- here's the release

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