Clovis Oncology Stock Jumps as FDA Skips Review Panel for New Cancer Drug

Published: Sep 12, 2016

Clovis Oncology Stock Jumps as FDA Skips Review Panel for New Cancer Drug September 9, 2016
By Alex Keown, Breaking News Staff

BOULDER, Colo. – Shares of Clovis Oncology jumped more than 15 percent Thursday after the U.S. Food and Drug Administration opted to not hold an advisory committee meeting to discuss the company’s application for its ovarian cancer drug, rucaparib.

Rucaparib is a PARP inhibitor developed for the treatment of patients with platinum-sensitive, high-grade serous or endometrioid epithelial ovarian, primary peritoneal or fallopian tube cancer. Rucaparib was granted Breakthrough Therapy designation by the FDA in April 2015. The FDA accepted rucaparib for priority review last month.

“The acceptance of the rucaparib NDA submission represents an important milestone for rucaparib, and for Clovis,” Patrick Mahaffy, president and chief executive officer of Clovis Oncology, said at the time the FDA granted the priority review. “There is tremendous need for additional therapeutic options for patients with advanced mutant BRCA ovarian cancer and we look forward to cooperating with FDA on the rucaparib NDA review.”

Currently there are few standard treatment options for recurrent ovarian cancer. According to the American Cancer Society, more than 22,000 women will be diagnosed with ovarian cancer in the U.S. during 2016. It’s estimated by the society that the cancer will spread to other parts of the body before ovarian cancer will be diagnosed.

Stock jumped after the company disclosed in a federal filing the FDA decided to skip the advisory review. Such a maneuver is often taken as a signal by investors there is strong likelihood the drug will be approved, analysts at the Motley Fool said. The FDA is slated to rule on rucaparib pm Feb. 23, 2017. However, the Motley Fool noted that the drug could have an even earlier review, which would be tremendous news for Clovis as early sales analysis pegs rucaparib as a blockbuster drug, earning at least $1 billion in annual sales.

This is good news for the company that was forced to eliminate 35 percent of its workforce in May after it terminated lung cancer trials for its experimental drug rociletinib. In April, a U.S. Food and Drug Administration panel recommended against giving the company’s lung cancer drug, rociletinib, an accelerated approval. More recently, Clovis said it met with the FDA and was told it would receive a Complete Response Letter regarding the drug on or before the June 28 deadline for the regulatory agency to rule on a new drug. A Complete Response Letter is issued by the FDA to notify a company that its new drug is not ready for approval. As a result of the Complete Response Letter, Colorado-based Clovis said it was eliminating enrollment in all ongoing sponsored clinical studies of rociletinib.

If rucaparib is approved and Clovis continues to surge, that could attract the interests of larger pharma companies which might want to snap up the smaller oncology companies. Fool analysts noted that Pfizer just snapped up Medivation for $14 billion for a pipeline that includes talazoparib, another PARP inhibitor. Talazoparib is considered a possible blockbuster—over $1 billion in annual sales.

Shares of Clovis are slightly down this morning from Thursday’s high, trading at $27.39 as of 10:24 a.m.

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