United Therapeutics skids 24%, to $11.31

FDA delays ruling on Remodulin, company's lead drug

April 17, 2001|By Bill Atkinson | Bill Atkinson,SUN STAFF

Shares of United Therapeutics Corp. tumbled 24 percent yesterday after the Food and Drug Administration said it would extend its review of the company's lead drug by up to three months.

The Silver Spring-based biotechnology company's stock closed at $11.31, down $3.59 from $14.90 last week. Shares have slid from a 52-week high of $132 on July 12.

The sell-off was triggered by United Therapeutics' announcement Thursday after the market closed for the week that regulators would need additional time to review its application for Remodulin, a drug that treats pulmonary arterial hypertension, a potentially life-threatening disease.

"We never comment on why the stock goes up or why the stock goes down," said Fred Hadeed, United Therapeutics' chief financial officer. "Certainly, some people reacted and it impacted the stock. We are working very hard to get Remodulin approved, and we feel confident that we will have an answer in 90 days or less."

Craig D. West, a biotechnology analyst at A. G. Edwards & Sons in St. Louis, yesterday downgraded the stock to a "reduce" from "maintain" position.

"The risk of the shares not performing are great," West said. "I don't know about the prospects of getting this thing past. We have always continued to believe ... that the drug would get approved. We still lean, although it is a fairly weak lean, to the product's eventual approval."

West also said the company has offered little guidance on the information that it submitted to the FDA.

"The information flow to the investor ... hasn't been good," he said. "In our minds ... what is happening with the story is opaque."

United Therapeutics filed its new drug application for Remodulin with the FDA on Oct. 16 and requested a six-month priority review, Hadeed said. But the company was recently asked to provide additional information on the drug.

"As a result of this extension for the Remodulin NDA review period, United Therapeutics' previously released revenue forecasts are no longer accurate," the company said in its statement Thursday.

Hadeed said it is understandable that the agency wanted an extension.

The application "is a huge volume of information you are talking about, literally a truck-load of paper," he said. "Very few NDAs are approved in less than six months and it is not uncommon at all for the agency to take longer than six months."

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