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Why Zogenix, Inc. Was a House of Pain for Investors

By Dave Williamson - Mar 6, 2014 at 7:44PM

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Did the FDA just give the green light to a dangerous drug from Zogenix?

Zogenix ( ZGNX -4.97% ) just took a painful one-two punch on the market today, causing shares to fall 15%. First, the company reported Q4 earnings, which missed estimates; but that wasn't the real story with the company today. Much more painful to the stock was the continued lobbying against the company's freshly approved painkiller Zohydro. Despite an 11-2 advisory committee vote against approving the drug due to concerns that it had a high potential for abuse, the FDA still decided to approve the extremely effective drug.

In this video, Motley Fool health-care analyst David Williamson discusses the vocal opponents of the drug, and highlights the company's biggest threat: that the FDA would reconsider, and reverse its decision.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis – even one of our own – helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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Stocks Mentioned

Pfizer Inc. Stock Quote
Pfizer Inc.
PFE
$54.27 (2.32%) $1.23
Zogenix, Inc. Stock Quote
Zogenix, Inc.
ZGNX
$11.85 (-4.97%) $0.62

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