Achaogen Inc (NASDAQ: AKAO) is having an incredibly bad day in the market today, and for good reason. An FDA advisory committee has handed down a split vote with regard to the company’s lead candidate, leading to concern among investors and sending the stock spiraling downward. Today, we’ll talk about:
- The vote;
- what we’re seeing from AKAO; and
- what we’ll be watching for ahead.
AKAO Is Headed For The Bottom ON FDA News
As mentioned above, Achaogen is having an incredibly rough day in the market today after FDA news hit the tape. Unfortunately, an FDA advisory committee has handed down a split vote surrounding the company’s lead antibiotic candidate, one which had incredibly high expectations.
For AKAO, the split decision is bad news. The drug, plazomicin, was submitted to the FDA as a treatment for bloodstream infection due to Carbapenem-resistant Enterobacteriaceae as well as complicated urinary tract infections. While the Advisory Committee voted down the bloodstream infections indication, the committee voted yes when it came to treating complicated urinary tract infections. There are fears, however, that, with the mixed vote in mind, the FDA will issue a CRL rather than a drug approval after the full review of the NDA.
One of the big issues that AKAO faces with regard to the NDA is the smaller-than-expected sample size. Unfortunately, the small sample size has complicated the statistical analysis. In fact, the company had to amend protocols because only 37 patients enrolled and the study planned for 286 patients to enroll.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to work in the market is that the news causes moves. In this particular case, the news proved to be overwhelmingly negative. After all, investors were looking at plazomicin as a sure thing with regard to FDA approval. Now, Achaogen is plagued by a dark cloud of uncertainty. So, it’s no surprise that we’re seeing big declines in the value of the stock today. At the moment (11:52), AKAO is trading at $11.64 per share after a loss of $3.06 per share (20.82%) thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on AKAO. In particular, we’re interested in following the story surrounding plazomicin closely. While there is uncertainty, there is still hope. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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