Fortress Biotech Stock Plummets 31% on FDA Rejection of Rare Disease Drug
Company receives a Complete Response Letter for its Menkes disease treatment, CUTX-101, citing manufacturing issues, not safety or efficacy concerns.
Shares of Fortress Biotech (FBIO) plunged in premarket trading after the company announced a significant regulatory setback for its rare disease treatment. The stock fell approximately 31% following the news that the U.S. Food and Drug Administration (FDA) issued a Complete Response Letter (CRL) for the New Drug Application (NDA) of CUTX-101, a therapy for the rare and fatal genetic disorder Menkes disease.
The CRL indicates that the FDA cannot approve the application in its current form. However, the rejection was not related to the drug's clinical data. According to the company, the agency's concerns are tied to at the manufacturing facility. Fortress emphasized that the FDA did not request any new clinical efficacy or safety studies, suggesting the core data package for CUTX-101 remains solid.
"The FDA's decision creates a delay but keeps the path to approval open, pending the resolution of manufacturing issues," said one market analyst. Responsibility for addressing the FDA's concerns now falls to Sentynl Therapeutics, which acquired the rights to develop and commercialize the treatment from Fortress's subsidiary, Cyprium Therapeutics, in late 2023. Sentynl plans to meet with the FDA to discuss the necessary steps for a potential resubmission of the NDA.
The setback postpones significant potential revenue for Cyprium, which stands to receive up to $129 million in milestone payments and royalties upon the drug's approval. The drug previously received multiple special designations from the FDA, including , highlighting its potential to address a critical unmet medical need. Investors will be closely watching for updates on the manufacturing remediation and the timeline for a revised application, as the demonstrates the high stakes involved.