If I'm understanding this right, Biodel (Nasdaq: BIOD) has decided to basically abandon the supposedly-ready-for-market version of Linjeta and is more or less going back to the drawing board. More specifically, the company is going to work on some alternative formulations of Linjeta with an eye towards starting a Phase 2 study in 2012.
Now, that's a big surprise to me. Biodel got rejected by the FDA supposedly because some samples were contaminated/altered by poor packaging and storage and that messed up the total data package. Supposedly, if those tainted results were removed from the data package, it was an effective, safe, and approvable product.
If that were true, why is the company just chucking that formulation and setting the time-to-market clock back at least five years? If the version of Linjeta that they filed an NDA for actually worked, why aren't they running another Phase 3 and looking to get that on the market?
Although the company doesn't have the money to do a Phase 3 without another capital raise, it takes even more capital to go all the way back to Phase 2 and work back towards another NDA. Not surprisingly, though, the company is also putting its other R&D programs on ice including a basal insulin and the VIAtab sublingual version (which I never thought had much hope anyway...).
All in all, a very curious set of moves in my view. Given that I'm not sure what exactly this means about the real quality of Linjeta, the real issues with the NDA, and the implications that all has on management integrity and believability, I'd be very cautious with this stock.
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