Premature birth drug in question Friday, 20 January 2012 02:09

Columbia Laboratories’ and Watson Pharmaceuticals’ gel for reducing the risk of premature birth did not work for US women, US health reviewers said on Tuesday, sending shares of the companies tumbling.

The Food and Drug Administration reviewers said the gel’s efficacy was “a major concern” and asked an advisory panel to consider whether the company should conduct more US clinical trials.

Columbia’s shares plunged more than 50 percent, while shares of Watson Pharmaceuticals, which is developing the drug with Columbia, dropped almost 7 percent.

Analysts said the FDA’s review was disappointing since Watson had recently been trying to make a bigger push into higher-margin branded drugs, rather than its usual focus on generics.

“This drug is supposed to be the centerpiece of (Watson’s) bold new effort in branded pharmaceuticals,” said Corey Davis, an analyst at Jefferies. “It’s important strategically for them.”

But most analysts said the gel was not a huge product for Watson in terms of sales. Davis pegged peak annual sales for the product at $250 million. The company had revenues of $3.6 billion in 2010.

The vaginal gel, which contains the hormone progesterone, is meant for women with a short cervix, who have a higher risk of premature birth.

Preterm birth affects 10 to 12 percent of all pregnancies in the United States, and babies born early have a higher risk of early death and long-term health and developmental problems.

The reviewers’ comments were posted on the FDA’s website on Tuesday. On Friday an FDA panel of outside experts will vote on whether the agency should approve the drug, and the FDA will make a final decision by February 26.

Last year, Columbia and Watson said that in trials, their gel helped cut the risk of premature birth by almost 45 percent for women worldwide.

But the FDA staff said the drug’s efficacy for U.S. women was not statistically significant. The staff also said the overall trial results may have been influenced by the drug’s success in countries such as Belarus and South Africa.

The FDA staff said patients treated with the gel did not have a higher rate of side effects than patients using a placebo.

If approved, the Prochieve gel would compete with a similar drug called Makena from K-V Pharmaceutical Co.

Columbia shares have been particularly volatile over the past year. They are down more than 70 percent from a high of $4.31 last April.

On Thursday, they closed down 54.4 percent to $1.10 on the Nasdaq. Shares of Watson fell 6.8 percent to $57.98 on the New York Stock ExchangeReuters

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