FDA Rejection Blasts Biovail

Biovail (BVF Quote) plunged 17% Friday after the Food and Drug Administration rejected its new antidepressant drug.

The Toronto-based drug company said it got a nonapproval letter from the FDA on BVF-033, which the company described as a novel once-daily salt formulation of bupropion. Bupropion is best known as the active ingredient in Glaxo's (GSK Quote) Wellbutrin.

"The main issue raised by the FDA in its letter related to the design of the pharmacokinetic studies required to support the NDA," Biovail said, referring to its new drug application. "Biovail believes the studies were appropriate. However, the company is evaluating the issue and will meet with the FDA as soon as possible to discuss necessary steps to resolve this matter."

The company had high hopes for BVF-033. In a May earnings release, Biovail said that "with an FDA action date for BVF-033 in July and a maturing development pipeline, Biovail is entering a new-product cycle that should drive long-term growth for the company."

Shares tumbled $4.27 to $21.26.