[Biotech&Pharma] How An FDA Committee Pulled The Rug Out From This Highflying Biotech

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Nektar Therapeutics (NKTR) pulled its application for a pain drug after a Food and Drug Administration committee rejected it — sending NKTR stock into a slide Wednesday.




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On the stock market today, NKTR stock tumbled 16%, to 23.49, in above-average volume. NKTR stock had run up nearly 30% over the past three trading days following a deeper collaboration deal with Bristol-Myers Squibb (BMY).

But late Tuesday, an FDA advisory committee unanimously shot down Nektar's drug, oxycodegol. The committee decided the risks of the pain management treatment outweigh the benefits.

The committee's vote isn't binding, meaning the full FDA could still have approved the drug. But Nektar instead decided to withdraw its application for oxycodegol. Doing so will save the biotech company $75 million to $125 million in 2020, according to a news release.

NKTR Stock Dives On Committee Vote

Nektar imagined oxycodegol would help patients suffering from chronic pain who are reliant on addictive opioids. A number of Big Pharma stalwarts, like Johnson & Johnson (JNJ), are embroiled in lawsuits surrounding the opioid epidemic.

The advisory committee vote pulled the rug out from under NKTR stock on Wednesday.

“The company is disappointed in the committee's vote regarding oxycodegol and believes it is also disappointing for patients suffering from chronic pain and the physicians that treat those patients who are currently relying on existing opioid therapies,” Nektar said.

Clinical studies of oxycodegol included more than 2,000 patients and volunteers.

Now, Nektar says it won't invest any additional funding into developing the drug.

Follow Allison Gatlin on Twitter at @IBD_AGatlin.

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