- Verrica Pharmaceuticals Inc (NASDAQ:VRCA) was slapped with a third FDA rejection for YCANTH (VP-102) as general contract manufacturing organization challenges continue to plague the approval.
- RBC Capital Markets has downgraded the stock to Sector Perform from Outperform and lowered the price target from $16 to $4.
- The analysts note that the issues fall outside of the VP-102's purview. But as per a follow-up call with management, these recurrent offenses highlight the challenges at play with a manufacturing facility that continues to obstruct regulatory approval.
- VRCA is working with the FDA and Sterling to resolve the deficiency and potentially identify a new manufacturing partner for the resubmission.
- RBC writes that VRCA plans to file a Type A meeting request by the end of the week and is working with Sterling to present multiple options to FDA to resolve deficiencies expeditiously.
- Concurrently, the management is exploring alternative suppliers of VP-102's bulk solution and has identified one non-sterile facility with transfer underway.
- As per the analysts, the management hinted at January 2023 for resubmission with a 6-month review period as a conservative estimate regarding the timeline.
- Price Action: VRCA shares are up 63% at $2.06 during the market session on the last check Wednesday.
