BHVN Stock Tumbled A Whopping 44% Today – What Did The FDA Letter Say?

• Biohaven was seeking approval for its drug Vyglxia in the treatment of Spinocerebellar ataxia. 
• The company is in the process of formally requesting a meeting as soon as possible to determine the potential next steps.
• Biohaven added that it may pause or delay non-priority programs to maintain its cash runway in the near term. 
   

Shares of Biohaven (BHVN) slumped 44% in the premarket session on Wednesday after the U.S. Food and Drug Administration refused to approve its drug Vyglxia in the treatment of Spinocerebellar ataxia (SCA).

Spinocerebellar ataxia is a neurodegenerative disorder characterized by progressive loss of voluntary motor control and atrophy of the brain’s cerebellum and brainstem. According to Biohaven, the condition affects approximately 15,000 people in the United States, but there are currently no FDA-approved treatments available.

What Did The FDA Say?

In a letter, the FDA cited issues including potential bias, design flaws, lack of pre-specification, and unmeasured confounding factors in Biohaven’s drug studies. The agency also recommended that the company meet with the agency to discuss the evidence that will be needed to support a future application.

Biohaven is in the process of formally requesting a meeting as soon as possible to determine the potential next steps.

Biohaven’s Response

Biohaven CEO Vlad Coric expressed disappointment over the FDA decision. “There are a number of common sense solutions and regulatory tools that the (FDA’s) Office of Neuroscience could have applied including a fair hearing of the drug's efficacy and safety risks at an Advisory Committee of experts and patients, post-marketing studies, labelling limitations or an accelerated approval pathway,” he said.

Steps Forward

In the meantime, Biohaven said it will prioritize resources to focus all its research and development resources on other key programs in its portfolio.

Over the next year, the company will focus on three late-stage, clinical programs with the greatest potential for value generation. It has also initiated strategic portfolio and cost optimization across multiple programs to achieve an approximately 60% reduction in annual direct research and development spend.

The company added that it may pause or delay non-priority programs to maintain its cash runway.

How Did Stocktwits Users React?

On Stocktwits, retail sentiment around BHVN stock stayed within the ‘extremely bullish’ territory over the past 24 hours, while message volume stayed at ‘extremely high’ levels.

A Stocktwits user expressed hopes for the pipeline.

BHVN stock is down 63% this year and approximately 73% over the past 12 months. 

Read also: Why Upstart Stock Is Plunging Over 14% Premarket Today

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