Shares of biopharmaceutical company Fortress Biotech (FBIO -4.14%) are dropping sharply on Tuesday after the company announced a regulatory update regarding one of its subsidiaries, Avenue Therapeutics (ATXI 1.36%). As of 2:49 p.m. EDT, shares of Fortress Biotech were down by 11.3%.
Avenue Therapeutics' New Drug Application (NDA) for IV tramadol, a medication intended for the management of acute pain in patients who require an opioid, has been in limbo for several months. In October, the U.S. Food and Drug Administration (FDA) issued a Complete Letter Response (CLR) to Avenue Therapeutics for this medicine.
After a productive meeting with the regulatory agency, Avenue Therapeutics planned on resubmitting an NDA for IV tramadol in February. The company did so, and it received an acknowledgment letter from the FDA stating that its NDA resubmission for IV tramadol was a complete, class 1 response to the agency's CLR.
The FDA classifying Avenue Therapeutics' response to its CLR as a class 1 response was good news as these typically come with shorter review times (two months instead of six months for class 2 responses). However, Avenue Therapeutics announced today that the FDA is still reviewing its NDA for IV tramadol and has yet to reach a decision regarding the medicine. This is despite the fact that the agency had assigned a Prescription Drug User Fee Act (PDUFA) goal date of April 12 after the healthcare company resubmitted its NDA for IV tramadol.
It isn't clear whether this delayed response from the FDA will eventually result in another rejection for IV tramadol. However, the market does not like uncertainty, and this development adds a whole lot of uncertainty to the mix for Avenue Therapeutics. As its parent company, Fortress Biotech is also feeling the effects of this news.