Welcome to the world of biotech, Fools. Euphoria doesn't guarantee success.
The FDA's letter had a lot of bad news, but at least Savient won't have to run any additional clinical trials to prove the drug's safety or effectiveness. However, it'll still take the company until early 2010 to address the agency's concerns:
- The need for a Risk Evaluation and Mitigation Strategy (REMS). Given the side effect profile, this isn't unexpected.
- Tighter chemistry, manufacturing, and controls (CMC). The FDA wants less variation between lots, which shouldn't be a problem for approval, but theoretically could force Savient to throw out production runs.
- Comparability between product used in clinical trials and the drug that will be sold commercially. Savient changed its manufacturing process after the clinical trials; the agency isn't so sure it's the same stuff.
The comparability issue has tripped up quite a few drugmakers recently. Bristol-Myers Squibb
Apparently the new manufacturing procedure wasn't all that important to Savient, because it plans to revert back to the old procedure rather than run a clinical trial to prove that the new procedure yields an equivalent product. That's probably a good move, considering that time is money -- especially for drugmakers with limited patent time.
I think it's likely that Savient can get the issues cleared up, but there' probably no rush to buy in at this point. The rollercoaster ride may not end today, and it seems likely there will be plenty more dips ahead, should investors wish to grab cheaper shares.
Take another whirl on the Foolish coaster: