Heron Therapeutics Inc (NASDAQ: HRTX) is having an overwhelmingly rough day in the market today, and for good reason. The company announced that the FDA has rejected a New Drug Application (NDA), upsetting investors who are sending the stock tumbling. Today, we’ll talk about:
- The FDA rejection;
- what we’re seeing from HRTX stock as a result; and
- what we’ll be watching for ahead.
HRTX Stock Falls On FDA Rejection
As mentioned above, Heron Therapeutics is having an overwhelmingly rough start to the trading session this morning after announcing that the FDA has rejected a New Drug Application. The news came by way of press release early this morning.
In the release, HRTX said that it received a Complete Response Letter (CRL) from the FDA on April 30, 2019. The CRL surrounded the company’s New Drug Application for HTX-011 for the management of postoperative pain.
In the CRL, the FDA said that it was unable to approve the NDA in its present form based on the need for additional CMC and non-clinical information. While the FDA did reject the treatment, it did not identify any clinical safety or efficacy issues. Also, there will be no requirement for further clinical studies or data analysis.
In a statement, Barry Quart, Pharm.D., President and CEO at HRTX, had the following to offer:
We plan to request a meeting with the FDA to obtain its agreement on our approach to resolve the issues outlined in the CRL and resubmit the NDA as soon as possible.
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 leads to moves. When it comes to Heron Therapeutics, the news proved to be overwhelmingly negative.
After all, while there were no safety or efficacy concerns, meaning that the company will likely be able to resubmit the treatment for approval, the CRL means that there will be a delay. Unfortunately, these types of delays are quite costly.
So, it’s not surprising to see that upset investors are pushing the stock on a run for the bottom in the market this morning. As is just about always the case, our partners at Trade Ideas were the first to alert us to the declines. At the moment (9:17), HRTX is trading at $16.32 per share after a loss of $5.36 per share or 24.72% 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 HRTX. In particular, we’re interested in following the story surrounding the company’s work to bring HTX-011 to market. While the CRL is bad news, there is still likely a path as safety and tolerability concerns were not mentioned. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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