What happened
Shares of biosimilar pharmaceutical maker Alvotech (ALVO 3.66%) were up more than 11% as of noon on Friday. On Thursday, it plunged more than 6% after the company announced it had received a complete response letter (CRL) from the Food and Drug Administration (FDA) regarding one of its therapies.
So what
Friday's bounce back is a reaction to what is being viewed as the market's overreaction the day before. While the FDA did issue a complete response to a second Biologics License Application (BLA) for AVT02, a high-concentration Humira biosimilar candidate, delaying the drug's approval, that CRL had to do with deficiencies the FDA saw in the Iceland-based company's Reykjavik facility, rather than any issues with AVT02 itself.
Humira, made by AbbVie, is a therapy approved to treat a variety of inflammatory conditions. Other than COVID-19 vaccines, it was the top-selling drug in the world over the last few years.
Now what
The setback for AVT02 is likely only temporary. Alvotech said it will raise additional funds to continue the development of its biosimilar pipeline, which includes seven named and three unnamed therapies. AVT02 has already been approved by regulators for sale in 27 countries, so ultimately, the company should be able to get approval for it from the FDA.
"We remain committed to bringing AVT02 to patients in the US, where the need for a high-concentration, interchangeable biosimilar to Humira remains significant," Alvotech Chairman and CEO Robert Wessman said in a press release issued Wednesday. "We expect that a reinspection of our manufacturing facility will be required to gain approval in the US and anticipate a reinspection following resubmission of a BLA for AVT02."
In the first quarter, the company reported $15.9 million in revenue, but booked a net loss of $276.2 million. It said it had $115.8 million in cash and equivalents on its books at the end of the quarter, so its need to raise more funds is obvious.
