Capricor shares sink as US FDA declines to approve cell therapy

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By Christy Santhosh

(Reuters) -The U.S. Food and Drug Administration has declined to approve Capricor Therapeutics’ cell therapy for a heart condition, the company said on Friday, sending its shares tumbling 30% in early trading.

In its “complete response letter,” the agency said the evidence submitted for the therapy, Deramiocel, does not meet efficacy requirements and asked for more data.

Capricor was seeking approval to treat cardiomyopathy, or a heart muscle disease, in patients with Duchenne muscular dystrophy, a genetic disorder characterized by progressive muscle degeneration.

The letter was issued more than a month ahead of the FDA’s scheduled priority review date of August 31.

Capricor plans to resubmit the application in the third quarter with data from an ongoing late-stage study.

JonesTrading analyst Catherine Novack had earlier said that an August approval was unlikely due to the sudden cancellation of an advisory panel meeting and the dismissal of key officials at the Center for Biologics Evaluation and Research (CBER), the primary regulatory body for cell therapies.

Cell therapy developers are also set to face increased regulatory scrutiny since the appointment of Vinay Prasad as CBER chief in May.

“Prasad has been vocal in his opposition to single-arm trials and accelerated approval,” said Piper Sandler analyst Edward Tenthoff.

B. Riley Securities analysts said the FDA cited technical limitations in the data, but “keeps the door open” by allowing late-stage data as a major amendment instead of requiring a full resubmission.

The company said it was surprised by the decision and was seeking a meeting with the FDA to discuss the next steps.

“We do not believe that a new BLA (marketing application) will be necessary,” CEO Linda Marban told analysts on a conference call.

(Reporting by Christy Santhosh in Bengaluru; Editing by Sriraj Kalluvila and Sahal Muhammed)