NPS Pharmaceuticals (NASDAQ:NPSP) announced this morning that the FDA delayed the action date for Gattex, an orphan drug treatment for Short Bowel Syndrome (SBS). The PDUFA date for Gattex’s New Drug Application, submitted in November of last year, was extended to December 30. The drug would be NPS’ first to market alone; the company has a number of partnered products in commercialization.The drug is an analog GLP-2 that has potential as the first treatment for adult SBS and was thus granted Orphan Drug status by the FDA, allowing for a swifter approval process and opportunity for government grants in some instances.
While the FDA’s decision looks bad for NPS, delays are often warranted when trial data is submitted within three months of a PDUFA date. In this case, the FDA needed additional time to review the submission and will likely not move the date again. Shares are down 3% this morning and are unlikely to decline further. After a buildup in the preceding months, many investors took profits in June when NPSP hit a new 52-week high of $9.28; shares have since declined to around $7. Much of the anticipation surrounding Gattex already dissipated and today’s announcement may further that sentiment. A rise is likely leading into the new PDUFA date in December.