Shares of Mallinckrodt (MNK) dropped in morning trading, but have recovered and turned positive in an up day for the broader market, after the Food and Drug Administration declined to approve a reformulated version of the drug maker's opioid painkiller Roxicodone. The new version was designed to deter opioid abuse.
COMPLETE RESPONSE LETTER: On Wednesday, Mallinckrodt said that its SpecGx LLC subsidiary received a Complete Response Letter from the U.S. Food and Drug Administration regarding its new drug application for Roxicodone, a treatment for pain that is severe enough to require an opioid. The letter provides guidance on areas of further evaluation needed to resubmit the NDA for further review and possible approval of the drug, which was designed with properties to deter intravenous and intranasal abuse under the company's 505(b)(2) new drug application for MNK-812, the company said. Matt Harbaugh, the company's president, Specialty Generics, said in a statement that "We are evaluating the FDA's letter and will request a meeting in the coming weeks to discuss it further. We continue to believe this new abuse-deterrent formulation has the potential to mitigate opioid abuse and misuse, and though we're disappointed by the FDA's decision, we will continue to pursue a pathway to try to gain approval of the drug." Mallinckrodt is planning to spin off its specialty generics business to shareholders by the second half of 2019, but said it was still open to a sale of the unit, it said last week.
WHAT'S NOTABLE: Roxicodone is an abuse-deterrent, immediate-release formulation that the company is developing as part of an effort to curb the current opioid addiction crisis in the U.S. The FDA's decision comes after an advisory panel last month voted 10-7 in favor of the drug. The committee also voted 12-5 that the drug should be labeled abuse-deterrent by the nasal route of abuse and 10-7 that it should not be labeled abuse-deterrent by the intravenous route of abuse. At the time, a panel member who voted in favor of the drug's approval said that "While all the abuse deterrent properties of this medication are perhaps not as robust as we might like, it is an important advance over the existing formulation." In June 2017, Endo International's (ENDP) reformulated Opana ER was withdrawn from the market after data showed that while rates of nasal abuse associated with Opana fell, rates of intravenous abuse rose. Mallinckrodt, Endo and others including Johnson & Johnson (JNJ) have been sued by local and state government who claim the companies have contributed to the national epidemic through their marketing and promotion of opioids.
PRICE ACTION: In morning trading, shares of Mallinckrodt initially moved lower. However, at time of writing, the stock is up 1.3% to $21.21.
Mallinckrodt
+0.16 (+0.76%)
Endo
+0.23 (+2.05%)
Johnson & Johnson
+1.58 (+1.08%)