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Reata (RETA) Plunges on FDA Concerns for Kidney Failure Drug
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Shares of Reata Pharmaceuticals plunged nearly 40%, following the issuance of an FDA briefing document that raises concerns related to the clinical data submitted as part of the new drug application (“NDA”) seeking approval for the company’s pipeline candidate, bardoxolone methyl, for treating patients with chronic kidney disease (“CKD”) caused by the Alport syndrome.
We note that the FDA accepted Reata’s NDA for bardoxolone in April. Following a mid-cycle communication meeting, the FDA informed the company that an advisory committee would be held to discuss the NDA, which is scheduled for Dec 8.
In its briefing document, the FDA stated that its review team does not believe that the submitted data support the effectiveness of bardoxolone in patients with Alport syndrome. It raised concerns that treatment with bardoxolone may not slow loss of kidney function and reduce the risk of progression to kidney failure. The FDA also mentioned that there are no data from animal model included in the NDA that indicates that the candidate can slow the loss of kidney function..
We note that the FDA had raised four significant clinical and statistical review issues related to the bardoxolone NDA in August 2021. The company had submitted a written response to the regulatory authority.
The recent concerns raised by the FDA in its briefing document ahead of the advisory committee meeting led investors to doubt the potential approval for bardoxolone scheduled in February next year. Reata is dependent on successful development of bardoxolone as it is one of the company’s lead pipeline candidate. Any delay or failure to get approval for bardoxolone will hurt the company’s prospects.
Reata’s shares have declined 60.4% so far this year compared with the industry’s decrease of 21.7%.
Image Source: Zacks Investment Research
We note that Reata is investing a significant amount for the development of bardoxolone and another late-stage candidate, omaveloxolone.
Reata is developing omaveloxolone as a potential treatment for Friedreich’s ataxia. The company has completed a pivotal study followed by a baseline-controlled study and additional exploratory analyses evaluating the candidate. In October, Reata completed a pre-NDA meeting and stated that it will file an NDA with the FDA seeking approval for omaveloxolone in the first quarter of 2022.
The delay in the commercialization of these products will also delay benefits from these investments. The company’s high operating expenses to support the development and pre-commercialization activities for these candidates are putting pressure on its cash resources. With no regular revenues stream, concerns related to the company’s sustainability may arise amid high costs.
Vascular Biogenics’ loss per share estimates have narrowed from 44 cents to 42 cents for 2021 and from 40 cents to 37 cents for 2022 in the past 30 days.
Shares of Vascular Biogenics have risen 9% so far this year.
I-Mab’s loss per share estimates have improved from $2.84 to $2.76 for 2021 and from $2.17 to $1.94 for 2022 in the past 30 days.
Shares of I-Mab have gained 4.7% so far this year.
IVERIC bio’s loss per share estimates have improved from $1.18 to $1.09 for 2021 and from $1.17 to $1.03 for 2022 in the past 30 days.
IVERIC bio’s stock has surged 100.1% so far this year.
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Reata (RETA) Plunges on FDA Concerns for Kidney Failure Drug
Shares of Reata Pharmaceuticals plunged nearly 40%, following the issuance of an FDA briefing document that raises concerns related to the clinical data submitted as part of the new drug application (“NDA”) seeking approval for the company’s pipeline candidate, bardoxolone methyl, for treating patients with chronic kidney disease (“CKD”) caused by the Alport syndrome.
We note that the FDA accepted Reata’s NDA for bardoxolone in April. Following a mid-cycle communication meeting, the FDA informed the company that an advisory committee would be held to discuss the NDA, which is scheduled for Dec 8.
In its briefing document, the FDA stated that its review team does not believe that the submitted data support the effectiveness of bardoxolone in patients with Alport syndrome. It raised concerns that treatment with bardoxolone may not slow loss of kidney function and reduce the risk of progression to kidney failure. The FDA also mentioned that there are no data from animal model included in the NDA that indicates that the candidate can slow the loss of kidney function..
We note that the FDA had raised four significant clinical and statistical review issues related to the bardoxolone NDA in August 2021. The company had submitted a written response to the regulatory authority.
The recent concerns raised by the FDA in its briefing document ahead of the advisory committee meeting led investors to doubt the potential approval for bardoxolone scheduled in February next year. Reata is dependent on successful development of bardoxolone as it is one of the company’s lead pipeline candidate. Any delay or failure to get approval for bardoxolone will hurt the company’s prospects.
Reata’s shares have declined 60.4% so far this year compared with the industry’s decrease of 21.7%.
We note that Reata is investing a significant amount for the development of bardoxolone and another late-stage candidate, omaveloxolone.
Reata is developing omaveloxolone as a potential treatment for Friedreich’s ataxia. The company has completed a pivotal study followed by a baseline-controlled study and additional exploratory analyses evaluating the candidate. In October, Reata completed a pre-NDA meeting and stated that it will file an NDA with the FDA seeking approval for omaveloxolone in the first quarter of 2022.
The delay in the commercialization of these products will also delay benefits from these investments. The company’s high operating expenses to support the development and pre-commercialization activities for these candidates are putting pressure on its cash resources. With no regular revenues stream, concerns related to the company’s sustainability may arise amid high costs.
Reata Pharmaceuticals, Inc. Price
Reata Pharmaceuticals, Inc. price | Reata Pharmaceuticals, Inc. Quote
Zacks Rank & Stocks to Consider
Reata currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the biotech sector include Vascular Biogenics , I-Mab (IMAB - Free Report) and IVERIC bio , all carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Vascular Biogenics’ loss per share estimates have narrowed from 44 cents to 42 cents for 2021 and from 40 cents to 37 cents for 2022 in the past 30 days.
Shares of Vascular Biogenics have risen 9% so far this year.
I-Mab’s loss per share estimates have improved from $2.84 to $2.76 for 2021 and from $2.17 to $1.94 for 2022 in the past 30 days.
Shares of I-Mab have gained 4.7% so far this year.
IVERIC bio’s loss per share estimates have improved from $1.18 to $1.09 for 2021 and from $1.17 to $1.03 for 2022 in the past 30 days.
IVERIC bio’s stock has surged 100.1% so far this year.