Please ensure Javascript is enabled for purposes of website accessibility

Why DBV Technologies Is Plunging Today

By Prosper Junior Bakiny – Jun 26, 2020 at 4:28PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The company provided a grim business update.

What happened

DBV Technologies (DBVT 1.12%), a biopharmaceutical company based in France, provided a business update today regarding Viaskin, a potential peanut allergy treatment the company developed that is currently being reviewed by the U.S. Food and Drug Administration (FDA). DBV Technologies expressed concerns that the review process for Viaskin could be delayed, and the company announced a comprehensive restructuring plan to prepare for that possibility. As a result of these announcements, shares of the company are sinking lower today, and are down by 14.4% as of 3:35 p.m. EDT on Friday.

So what

Viaskin is a "peanut patch" that can desensitize a patient's immune system by gradually exposing the patient to increased amounts of peanut protein. DBV Technologies first submitted a Biologics License Application (BLA) for Viaskin in August of 2019. However, in March, the company announced that the FDA had questioned the effect of patch adhesion on Viaskin's efficacy during its review process. DBV Technologies submitted more data to the health industry regulator to address these issues, but the company has yet to hear back from the FDA.

Man standing on a red downward pointing arrow and looking far down.

Image source: Getty Images.

The target action date for the application, which is Aug. 5, remains the same. But considering the lack of update from the FDA, DBV Technologies "is implementing a restructuring plan that will provide the flexibility to continue the BLA review process, prepare to bring Viaskin Peanut to patients, if approved, and preserve the Company's cash runway." The company will reduce its workforce and scale several clinical programs.

Now what

DBV Technologies has at least one other thing to worry about, namely competition for Viaskin. In January, Aimmune Therapeutics (AIMT) became the first company to receive FDA approval for a treatment for peanut allergy. The drug in question is called Palforzia, and it works by gradually increasing a patient's tolerance to peanuts. Between the competition from Palforzia and the uncertainty surrounding its BLA for Viaskin, DBV Technologies' future seems a bit hazy. In short, this healthcare stock is not worth investing in right now.

Prosper Junior Bakiny has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

DBV Technologies S.A. Stock Quote
DBV Technologies S.A.
$1.80 (1.12%) $0.02
Aimmune Therapeutics, Inc. Stock Quote
Aimmune Therapeutics, Inc.

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/04/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.