- Shares of Reata Pharmaceuticals nearly tripled in value Wednesday after the company won Food and Drug Administration approval to sell the first treatment for a rare neuromuscular disease called Friedreich’s ataxia.
- The clearance, which happened Tuesday, followed years of questions about the strength of the data supporting Reata’s drug, known scientifically as omaveloxolone and now commercially as Skyclarys. Investor doubts about the approval were compounded by the recent resignation of FDA official Billy Dunn, who oversaw the division handling the medicine’s review and was widely seen as a likely supporter of it.
- Reata’s stock price jumped from about $31 to more than $86 in early trading Wednesday. Shares had dropped below $28 apiece on Monday after news of Dunn’s departure.
Reata’s regulatory triumph comes more than three years after it first announced plans to seek approval of the drug based on positive study results released in October 2019.
A series of meetings with often-skeptical FDA officials followed. Reata first performed a baseline-controlled study to support its trial results. But in November 2020, the company said the agency didn’t find that data convincing enough and asked for more exploratory analyses, which Reata undertook.
With no available treatments, patient advocates petitioned the FDA to make the drug available. And in May 2021, FDA officials had seen enough to tell the company that they could request a meeting to talk about submitting an application. Six months later, the agency gave the drug a fast-track designation, designed to speed reviews of medicines that fill an unmet medical need.
Reata began filing its approval request in January 2022 only to encounter a delay in August, when the FDA said it needed more time to evaluate new analyses submitted by the company. Meanwhile, the FDA decided not to hold a meeting of outside experts to evaluate the drug, as it initially indicated.
The back-and-forth left many investors predicting doom for the drug, especially after Reata failed to win FDA approval for an experimental kidney disease treatment last year. The departure of Dunn, whose flexibility in approving recent controversial neurological drugs was seen as a plus, added to the doubts about the medicine’s prospects.
But now, Reata has a full approval for the medicine in patients 16 and older and a priority review voucher, which can be used to speed up the review process of another drug. Companies are allowed to sell the vouchers; in November, Bluebird bio sold one for $102 million.
Reata says it’s ready to get Skyclarys to patients as soon as it can. The commercial team is “hired and trained” and infrastructure to sell the drug and oversee its use is in place, according to a company presentation.
Friedrich’s ataxia is an inherited disease that damages the nervous system, affecting a patient’s coordination and ability to walk. It affects about one of every 50,000 people in the U.S., according to the FDA. In Reata’s study, patients receiving the drug performed better on an assessment of swallowing, speech, coordination and stability.