Impax's Parkinson's drug rejected by FDA
The agency says the generic drug maker needs to resolve issues at a manufacturing plant in California.
Impax said in a press release that the FDA rejected Rytary, an extended-release drug for treatment of Parkinson's due to some previously known problems with a company plant. Impax has to resolve manufacturing violations at a plant in Hayward, California, a site that has had issues since at least 2010. The U.S. agency issued a warning in 2011 after its investigators found multiple and significant violations of manufacturing practices. See the FDA warning letter to Impax here. Rytary won't be approved until those issues are resolved, according to Impax.
The company said that it had withdrawn the Hayward plant as an alternative site for production of Rytary, but the FDA isn't satisfied. The rejection based on the Hayward plant issues came as a surprise. Some Wall Street analysts expected the drug, which helps motor symptoms in patients, to win approval.
"We will work with the FDA on the appropriate next steps for the Rytary application," Impax CEO Larry Hsu said in a statement. "We remain committed to resolving the warning letter and bringing this new treatment option to patients."
Shares of Impax about 6.5% to $19.66 in Tuesday trading. The stock is down 25% in the past three months.
In October 2012, Impax said its fourth-quarter revenue would decline by as much as 20% from third-quarter sales as the generic business faces increased competition.
Some analysts previously said Rytary appeared to be an approvable drug but cautioned that the product may face other challenges. An analysis by Leerink Swann last year raised the possibility of insurance coverage challenges if Rytary is launched.
In a note to clients Monday, Leerink Swann analyst Jason Gerberry estimated that it will take up to six months for Impax to satisfy the FDA on the Hayward plant. He expects the company will bring Rytary back to the agency for approval.
"Hayward issues are resolvable and we expect Rytary to eventually get approved," Gerberry says.
If Impax is successful with its next attempt to win approval, the drug may hit the market as soon as early 2014, the analyst says.
GlaxoSmithKline (GSK) has rights to the sell the drug in most countries outside the U.S.
More From Minyanville
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
The apparel chain takes a hard hit after blaming the weather for its quarterly sales decline. But cold temperatures don't explain the drop in full-year sales as well.
VIDEO ON MSN MONEY
Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.
Contributors include professional investors and journalists affiliated with MSN Money.
Follow us on Twitter @topstocksmsn.