Chelsea Therapeutics International, Ltd. (NASDAQ: CHTP) is seeing its shares crushed on FDA review news this morning which at one point had the stock down at a 52-week low.
After updating an ongoing FDA review of its lead drug Northera, there are now more concerns over the hypotension drug. Regulators noted some previously discussed concerns on the Northera program. The short duration and small trial group size were brought up ahead of Chelsea’s end of March review date for neurogenic orthostatic hypotension in Parkinson’s disease patients and others with primary autonomic failure. The FDA also cited a difficulty in quantifying symptomatic and clinical benefits.
The FDA had previously awarded an orphan status for the treatment and was giving it a priority review as there is a lack of real treatments for dangerous drops in blood pressure when patients stand up.
As it stands today, we expect a formal FDA decision by the end of March. Shares are down 34% at $3.29 on more than 8 million shares (about 13-times normal volume) and the prior 52-week range was $3.25 to $6.06.
This is not a deathblow yet even if the stock’s future is obviously far less certain now. If the FDA sends it back for a whole new round of tests or just denies the approval outright, then the company’s future may be much more in question.