AP Pharma, Inc. had a great day yesterday closing up 32.05% at $2.06 on strong volume of 6,300,000 traded shares in anticipation of news from the FDA on its leading drug candidate, “APF530”. APF 530 is developed for the prevention of both acute and delayed-onset chemotherapy nausea-induced vomiting (CNIV). AP530 contains granisetron, which has been approved in both oral and injections for immediate onset of CNIV, but not for delayed-onset. The granisetron is formulated with AP’s proprietary Biochronomer™ delivery system which allows drug levels to be maintained for 5 days from a single injection. AP Pharma had reported positive results in Phase 3 studies of APF530.
The Federal Drug Administration (FDA) has expressed several concerns about APF530 and did not grant approval as was reported to the press this morning. The FDA requires a Complete Response Letter (CRL) from AP Pharma regarding their concerns which included:
• The dosing system including issues with the two-syringe injection method and possibilities of improper administration of the drug by the patient.
• Chemistry, Manufacturing and Control issues. The FDA noted deficiencies in the contract manufacturing facilities, requests clarification on certain analytical specifications, and that AP Pharma switches to terminal sterility prior to approval of the drug.
• Clinical issues to which the FDA wants to see two additional studies regarding bioavailability and metabolism. Also, the FDA requires a thorough QT study, which AP had requested be waived.
AP Biopharm believes that some of these issues have already been addressed in an amendment that was submitted with the NDA (New Drug Application) which was not reviewed by the FDA prior to issuing the CRL. AP Pharma plans on scheduling a meeting with the FDA to address this issue.
The bottom line is that AP Pharma believes that with these requests, and the subsequent delays that accompany them, APF530 will not be launched commercially in 2010. The stock price is plummeting pre-market and is trading at $.9286 at the moment on 1,154,611 traded shares. This type of play can be a day trader’s dream because of extreme volatility of intraday movements.