Shares of Humanigen lost more than half their market value after the drugmaker's request for emergency-use authorization of its Covid-19 treatment candidate was rejected by the FDA.
Lenzilumab is designed to treat newly hospitalized Covid-19 patients. The U.S. Food and Drug Administration said that it was unable to conclude that the benefits of the drug outweigh the risks of its use.
"We remain committed to bringing lenzilumab to patients hospitalized with Covid-19," Chief Executive Cameron Durrant said in a statement.
The Burlingame, Calif., company says its continuing trial will enroll as many as 500 patients and could provide additional safety and efficacy data that could change the FDA's mind.
Shares of Humanigen at last check dropped 51% to $7.48. They have traded on Thursday down as much as 60% at $6.09.
A Covid-19 infection is accompanied by an aggressive inflammatory response from the body know as a cytokine storm. This hyperactivity causes an excessive inflammatory reaction that can result in hospitalization and death.
Humanigen focuses on preventing and treating cytokine storms.
In other Covid-19 news, Moderna said that it was developing a single-dose vaccine that combines its Covid vaccine and its candidate flu vaccine.
Earlier this month, the Cambridge, Mass., company asked the FDA to approve use of a third shot (booster shot) of its Covid-19 vaccine.
The company said it “has initiated its submission to the U.S. Food and Drug Administration for the evaluation of a booster dose of the Moderna Covid-19 vaccine (mRNA-1273) at the 50 µg dose level.”