Columbia Labs Plummet after Recommendation Denial by FDA

Shares of Columbia Labs

are seeing much pressure during Monday's trading session after the company announced on Friday that the FDA does not recommend its pre-term birth gel. Columbia Laboratories and Watson Pharmaceuticals

confirmed that the Advisory Committee for Reproductive Health Drugs of the FDA did not recommend approval of progesterone vaginal gel 8% for the reduction of risk of preterm birth in women with short uterine cervical length at the mid-trimester of pregnancy. While panel members generally agreed that progesterone vaginal gel 8% is safe, the panel stated that more information is needed to support approval. Commenting on the negative event, CEO of CBRX Frank Condella said, "We will work with the FDA to address the Advisory Committee's comments as the Agency finalizes its review of our NDA. We remain confident in the PREGNANT study results that showed the administration of progesterone vaginal gel 8% is a safe and effective treatment for patients at risk for preterm birth due to short uterine cervical length in the mid-trimester of pregnancy. We hope the agency's final decision will acknowledge the clear unmet medical need in this patient population." While the FDA will consider recommendations of the Committee, the final decision regarding the approval of the product rests solely with the FDA. The FDA's Division of Reproductive and Urologic Products is expected to take action on Columbia's New Drug Application by February 26, 2012. Currently shares of Columbia Labs are trading over 55% lower at $0.69; or down 72% on the year.