Shares of Ardelyx (ARDX 4.20%) were sinking 13% lower as of 11 a.m. EDT on Friday. The decline came after the company announced Thursday evening that the U.S. Food and Drug Administration (FDA) is pushing back its review period for tenapanor by three months.
Ardelyx originally hoped for an FDA approval of tenapanor in controlling serum phosphorus in adults with chronic kidney disease (CKD) on dialysis by yesterday. However, the agency requested additional analyses to help it better understand the drug's mechanism of action.
It's understandable why investors reacted negatively to the three-month delay. The news creates some uncertainty about the prospects for tenapanor.
Ardelyx CEO Mike Raab, though, remained optimistic that the drug would still win approval. He thinks that the additional analyses submitted after talking with the FDA "reinforce the extensive clinical evidence" in support of tenapanor. He said in a statement, "We are confident in the comprehensive data set, are well prepared for the launch of tenapanor upon potential approval and are dedicated to bringing this important medicine to patients."
The next major catalyst for the biotech stock will now come on or before July 29, when the FDA is scheduled to announce its approval decision for tenapanor. Despite the delay in the agency's review, the prospects for approval still seem to be pretty good. Ardelyx's filing was based on three successful late-stage clinical studies that included more than 1,000 patients.