This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

FDA Rejects Cyberonics' Device

The FDA rejected Cyberonics' (CYBX), VNS nerve stimulation device for use in patients suffering from severe depression this morning. As I and others have said all along, the data supporting the efficacy of the VNS device in depression was weak, to put it mildly. The FDA obviously agreed, overruling a recommendation for approval from an advisory panel held in May.

The company's press release basically blasted the FDA's decision in some very angry terms. But in the end, it seems as if negative data, and not emotion, spin and arm twisting, wins this battle.

CEO Skip Cummins just concluded what was an incredibly inflammatory conference call regarding this morning's FDA rejection of the company's VNS nerve stimulation device. Cummins blasted the FDA's decision as "shocking," "inexplicable" and "unprecedented." He strongly suggested that the FDA was to blame now for the suicides of 2,500 people with treatment-resistant depression every month (It should be noted that the figure quoted by Cummins just two months ago was 1,000 suicides per month.) Regardless, does Cummins really think that scorching the FDA is the best way to get the agency to reverse its decision? It seems like a funny way to negotiate, but then, Cummins has his own unique style.

This FDA rejection should only come as a surprise to people who didn't pay attention to the failed studies and weak data that Cyberonics presented to the FDA. The rejection is a surprise only to those who believed that emotion can or should trumpet the scientific process. (It can't.)

So what's next? Cyberonics said it will appeal, but the odds are not great. If that doesn't work, then a new study will be required. Cummins admitted that this route will likely take another three years.

As for Cyberonics' epilepsy business, and more importantly, the value of that business, well, I pretty much stand by what I wrote a couple of months ago. Bottom line: Epilepsy is not worth much. You can read the details here.

Adam Feuerstein writes regularly for In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in He also doesn't invest in hedge funds or other private investment partnerships. He invites you to send your feedback to

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,090.23 +60.02 0.33%
S&P 500 2,092.37 +10.49 0.50%
NASDAQ 4,813.8910 +40.4190 0.85%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs