Investopedia: Transcept Pharmaceuticals Bulls Get A Rude Awakening

FDA rejections are almost always painful for biotechnology companies, and Tuesday's press release from Transcept Pharmaceuticals (Nasdaq:TSPT) announcing that it expected another FDA rejection has certainly brought the pain. On mid-day Wednesday, the stock was down about 40% and approval of the company's middle-of-the-night sleeping pill is now looking like a more distant possibility. 

What Transcept Was Trying to Accomplish  
Transcept was hoping that the FDA would sign off and approve the company's proprietary low-dose formulation of zolpidem. This is a compound that was developed and marketed by Sanofi-Aventis (NYSE:SNY) as Ambien and is now manufactured as a generic by Teva Pharmaceuticals (Nasdaq:TEVA) and many others. This new drug, called Intermezzo, is targeted for people who awaken in the middle of the night and have difficulty getting back to sleep - the first so-called middle-of-the-night insomnia pill.

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