Six recipients of Apellis Pharmaceuticals' new eye-disease drug, Syfovre, experienced inflammation in their eyes, according to a report that sent APLS stock crashing Monday.
Syfovre gained approval in February to treat geographic atrophy, a disease in which the eye's macula progressively deteriorates. According to a notification posted online by the American Society of Retina Specialists, six patients experienced occlusive retinal vasculitis following their first Syfovre injections. This occurs when the blood vessels become inflamed.
The news is a departure from Apellis' final-phase studies in which no patients experienced this severe form of inflammation. Overall, 2%-4% of patients in Apellis' studies reported some inflammation, Wedbush analyst Laura Chico said in a note to clients. So far, Apellis has shipped 60,000 vials of Syfovre.
"With low single-digit rates of intraocular inflammation occurring in the Derby and Oaks studies, we assume similar rates will transpire in the real world," she said. "However, what's unclear is how many of the 60,000 vials have actually been administered and thus that may change the denominator."
On today's stock market, APLS stock plummeted 37.9% to 52.46. Shares are now well below their 50-day moving average, according to MarketSmith.com. APLS stock had climbed more than 63% this year prior to Monday's drop.
APLS Stock: Contamination Risks
It's important to note, Syfovre doesn't ship with its own syringe. That means physicians must use their own syringes and, thus, transfer the liquid themselves. This opens the door to contamination and infection, Evercore ISI analyst Umer Raffat said in his note to clients.
Further, Syfovre is a highly viscous liquid, so physicians may hit the stopper on the syringe when injecting the drug, which can also increase the risk of contamination.
"These factors set up a perfect storm for contamination/infection in the eye, especially in the context of a drug aimed at inhibiting (the immune system's) complement system," he said.
But he kept his outperform rating on APLS stock.
The news Monday sent Apellis shares to their lowest point since March.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
