Why Coherus Biosciences Shares Are Crashing

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Coherus Biosciences Inc. (NASDAQ: CHRS) saw its shares crater on Monday after the company announced that it received a complete response letter (CRL) from the U.S. Food and Drug Administration (FDA). This CRL was in relation to the firm’s biologics license application for CHS-1701, a pegfilgrastim (Neulasta) biosimilar candidate.

Keep in mind that Neulasta is owned by Amgen Inc. (NASDAQ: AMGN). Neulasta works to stimulate the growth of white blood cells in the body to fight against infection. Specifically, it is used to prevent neutropenia, a lack of certain white blood cells caused by receiving chemotherapy.

In the first quarter, Amgen reported sales of Neulasta to be $1.21 billion, an increase of 2% from the same period last year.

Back to Coherus, the CRL primarily focused on the FDA request for a reanalysis of a subset of subject samples with a revised immunogenicity assay, and requests for certain additional manufacturing related process information. The FDA did not request a clinical study to be performed in oncology patients. Additionally, the CRL does not indicate additional process qualification lots would be required or raise concerns over the Good Manufacturing Practice status of CHS-1701 bulk manufacturing and fill-finish vendors.

Denny Lanfear, president and CEO of Coherus BioSciences, commented:

While we are disappointed in the delay that this additional request has caused, we remain confident in our ability to address the FDA’s requests for the purpose of obtaining approval for CHS-1701. We are encouraged that a patient study has not been requested and we expect that we will be able to respond to the FDA and meet with them to define a path forward in the coming months.  Neulasta is the largest selling oncology biologic in the U.S., and we anticipate CHS-1701’s approval will generate significant U.S. healthcare savings while increasing patient access.

Shares of Coherus were trading down nearly 30% at $14.85 on Monday, with a consensus analyst price target of $7.35 and a 52-week range of $14.00 to $31.98.

Amgen shares were trading at $164.50. The 52-week range is $133.64 to $184.21 and the consensus price target is $180.83.