NEW YORK (AP) -- Shares of eye-care products maker ISTA Pharmaceuticals Inc. fell Friday over concerns that regulatory delays for two developing products could hurt the company.
The stock fell 95 cents, or 23.8 percent, to $3.01 in afternoon trading. Earlier in the session, shares hit $2.96 apiece, their lowest point in more than five years.
The company said the FDA needs more information comparing Xibrom QD, the developing once-daily formula of its ocular anti-inflammatory, to the already marketed twice-daily formula. ISTA said it intends to resubmit clinical data in the second quarter. Also, the company's delayed experimental topical steroid for eye infections, called T-Pred, also will need an additional study in order to be considered for approval.
"We do not agree with management's contention that, despite material reinvestment and reintroduced risk to both products, Xibrom QD and T-Pred will launch in late 2008 and 2009, respectively," Lazard Capital Markets analyst Megan Murphy said in a note to investors.
She downgraded the stock to "Sell" from "Hold" and lowered the price target to $1.50 from $5, saying the risks surrounding both programs are high and could prevent both drugs from gaining approval.
"As well, given the late disclosure regarding both clinical trial results and the FDA's commentary, we believe investors should be cautious when interpreting future data results," she said.
Meanwhile, Jefferies & Co. analyst David Windley reaffirmed a "Hold" rating, saying the company could lose its patent on the twice-daily formula of Xibrom before it gains approval of the once-daily version. Also, an additional T-Pred study could take between four and six months.
Meanwhile, the company reported a wider fourth-quarter loss on costs. ISTA lost $9.9 million, or 30 cents per share, compared with a loss of $6.4 million, or 25 cents per share, during the same period a year prior. Revenue rose 56 percent to $19.2 million from $12.3 million.
Analysts polled by Thomson Financial expected a loss of 26 cents per share.
For the full year, the company lost $38.2 million, or $1.29 per share, compared with a loss of $38.4 million, or $1.48 per share, in 2006. Revenue rose to $58.9 million from $33 million.
In 2008, ISTA expects revenue between $75 million and $82 million. Research and development costs are expected to range from $34 million to $38 million, while selling, general and administrative expenses are expected to range from $50 million to $54 million. <<
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