PTC Therapeutics' journey of "twist and doubt" continued Friday after European regulators rejected its muscular dystrophy drug — again — sending PTC stock into free fall.
The company's drug, Translarna, treats roughly 10% to 15% of Duchenne muscular dystrophy patients with what's called a nonsense mutation. Translarna has been available in Europe under a conditional marketing approval. But in September and January, the Committee for Medicinal Products for Human Use declined to fully approve the drug and wouldn't extend its conditional approval.
Instead of upholding CHMP's decision, the European Commission asked the committee to take another look in June. On Friday, CHMP stuck by its decision. PTC is already planning to ask for another re-examination. This time, it will go directly to the EC for a "final, legally binding decision," RBC Capital Markets analyst Brian Abrahams said in a report.
He says Translarna's journey has been filled with "twist and doubt."
"CHMP's decision to return its negative opinion to EC perpetuates the uncertainty around Translarna in Europe and potentially adds risk to its path forward in the U.S.," he said.
PTC stock tumbled 11.8% to 30.58.
PTC Stock: Translarna Sales Are Growing
Translarna is currently marketed in more than 50 countries, William Blair analyst Sami Corwin said in a report. Sales from outside Europe now account for more than half of total Translarna revenue, she said. The company is also working to expand Translarna, including into South America, North Africa and the Middle East, as well as launch into new markets like Japan.
She kept her outperform rating on PTC stock.
PTC Therapeutics assumes Translarna will stay on the market in Europe through the end of the year as the approval battle plays out, Leerink Partners analyst Joseph Schwartz said in a client report.
He notes that Translarna qualifies as an orphan drug, meaning it treats a rare disease. In Europe, orphan drugs get 10 years of market exclusivity. Further, Translarna treats children, so it gets another two years on top of that. That means the drug is due to lose patent protection in Europe in mid-2026.
Schwartz reiterated his market perform rating on PTC stock.
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