>I understand there are safety concerns but are they so serious as to lead to an 80% decline in the stock price, more from the mid-20's the stock was at not so long ago?<
More deaths, cardiovascular AE and anaphylaxis due to anti puricase antibodies relatively to control is very serious. I don't see a first round FDA approval and think SVNT will need to do more clinical trials.
Savient Pharmaceuticals has found an effective treatment for stubborn cases of gout, but its side effects are potentially worrisome. Investors fled the stock on Monday after a study raised questions over whether the drug could gain U.S. approval.
Shares of Savient Pharmaceuticals plunged Monday after investors received the results from a study that showed several adverse reactions in the hearts of patients taking Puricase, also known as pegloticase. The stock lost 73.5%, or $8.51, to close at $3.07. The biopharma concern has lost 89.2% of its value since reaching its 52-week high of $28.42, on July 16.
While Puricase has demonstrated in multiple studies that it effectively treats patients with long-term gout who have not responded well to other treatments, the latest results showed several adverse events. This worried investors and analysts alike. The eight adverse events during the study included two cardiac arrests and one myocardial infarction, or heart attack. These problems are on top of five previously reported deaths that were loosely linked to the drug, but may have been caused by preexisting conditions, like obesity and diabetes.
While the drug is effective in treating gout, the side-effects profile "does not appear favorable for Puricase," said Jefferies analyst Eun Yang.
Gout is a disease caused by build of uric acid in the blood resulting in painful swelling of the joints. This buildup can also result in crystallized formations that collect in the body.
"The emerging safety profile of long-term pegloticase therapy is consistent with that observed in the six-month double-blind studies, with no apparent new safety concerns related to long-term exposure," Savient said.
The company plans to submit its application for approval to the U.S. Food and Drug Administration at the end of the month. It typically takes six months for a drug to be approved. It guidance for 2009 was based on the approval of the drug and could be dramatically altered if the medicine is not approved because of the safety issues.
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