Somaxon stock plummets on drug delay
Shares of Somaxon Pharmaceuticals Inc. (Nasdaq: SOMX) plunged this morning on heavy volume after the company said it may have to delay its new drug application (NDA) submission for insomnia drug, Silenor.
Soon after the market opened, Somaxon shares had dropped by $1.82, or 10.1%, to $16.18. The stock has traded between $10.09 (on July 28) and $20.70 (on May 9) in the past year.
By 9:43 AM ET, volume was already strong – nearly 500,000 shares had changed hands, compared with an average three-month daily volume of 139,000 shares.
San Diego, Calif.-based Somaxon said it received a letter from the FDA on May 8 informing the company that its ongoing carcinogencity study of the drug should be included in the NDA. Somaxon President and CEO Ken Cohen said his firm was under the assumption that it could file the NDA without including the data. It planned to provide the information during the NDA review process.
Prior to receiving the letter, Cohen had said early in the day on May 8 that the firm planned to submit the NDA in the third quarter of 2007. He said also that the company was in talks with “a number” of other pharmaceutical firms “with the goal of optimizing the commercial success of Silenor” and completing a strategic transaction this year.
In a written statement issued this morning, Somaxon said the FDA request might now lead to a delay in the filing of its initial NDA submission until the 2008 first quarter. It plans to conduct the standard two-year carcinogenicity study and to submit the results of this study as a post-NDA approval commitment.
Cohen added: “While our NDA preparation activities continue as planned, we intend to discuss this latest communication with the FDA.”
In May of 2006, Somaxon initiated a preclinical program for Silenor, consisting of standard genotoxicity, reproductive toxicology and carcinogenicity studies.
In September 2006, Somaxon completed the genotoxicity studies and submitted the results to the FDA. The reproductive toxicology studies are ongoing, and Somaxon expects to finish them in the first half of this year. The 26-week transgenic mouse carcinogenicity study has been initiated.
The company has completed four Phase 3 clinical trials for Silenor, its lead product candidate.
