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Regulatory Concern For Celgene's Ozanimod Could Be Big For Arena Pharma, Novartis

Regulatory Concern For Celgene's Ozanimod Could Be Big For Arena Pharma, Novartis
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Celgene Corporation (NASDAQ: CELG) shares plummeted 10 percent Tuesday evening after the U.S. Food and Drug Administration rejected its New Drug Application for ozanimod in the treatment of relapsing multiple sclerosis.

What Happened

In a preliminary review, the FDA found that the clinical and nonclinical pharmacology sections were insufficient to merit a complete review. Celgene management will request a Type A meeting with the FDA and seek additional guidance to determine the changes required for resubmission.

"We remain confident in ozanimod's clinical profile demonstrated in the pivotal program in relapsing forms of multiple sclerosis," Jay Backstrom, chief medical officer and head of global regulatory affairs for Celgene, said in a press release. "We will work with the FDA to expeditiously address all outstanding items and bring this important medicine to patients."

What's Next

In the meantime, rivals may profit off Celgene’s pain. Novartis AG (ADR) (NYSE: NVS)’s Gilenya and Arena Pharmaceuticals, Inc. (NASDAQ: ARNA)’s etrasimod were expected to cede market share to ozanimod — a threat that weighed on the developers’ theses.

At time of publication, Celgene shares were set to open down 6.5 percent at $89.50. Arena traded up 2 percent, while Novartis trended marginally lower off the close.

Related Links:

Celgene's Pipeline In Question After GED Failure

A Survey Of Celgene's M&A Strategy

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