The pharmaceutical industry is a tough industry to invest in. You can read the clinical trial data from a scientific journal, make the right call about the FDA liking the efficacy data, and still be wrong about whether the FDA approves the drug.
Unfortunately, that's what happened to fellow Fool Billy Fisher. He correctly predicted that the FDA would like the data in Forest Laboratories' (NYSE: FRX ) and Mylan's (NYSE: MYL ) response to the agency's previously issued approvable letter for nebivolol. But he couldn't have known that the FDA would issue another approvable letter because of deficiencies in the backup manufacturing facility in Belgium.
The companies didn't give a time frame for responding to the approvable letter, but since there weren't any issues with efficacy or safety, the response should be up much quicker than the last. Forest is continuing with its plans to have a launch meeting next month, and the companies have even agreed with the FDA on labeling text, which is usually a good sign that an approval shouldn't be too far off.
Once the issues are resolved, Forest can begin marketing nebivolol under its branded name, Bystolic. Mylan, which licensed the drug from Johnson & Johnson's (NYSE: JNJ ) Janssen subsidiary, has the right to co-promote the drug, although it may be a little busy with integration issues to deal with a new drug launch.
The drug will join a crowded marketplace of beta blockers, including Wyeth's (NYSE: WYE ) Inderal and GlaxoSmithKline's (NYSE: GSK ) Coreg. With both of these drugs experiencing generic competition, Forest's sales reps could experience some heartache if doctors shun Bystolic in favor of cheaper generic drugs for their patients.