Cempra (CEMP) won a small measure of redemption for its controversial antibiotic solithromycin from an FDA advisory panel on Friday but securing U.S. marketing approval remains a difficult task because of the drug's liver toxicity problem.
By a slim 7-6 margin, experts convened by the FDA decided the benefits of solithromycin outweighed its potential safety problems in treating patients with community-acquired bacterial pneumonia.
Cempra shares rose 7% to $8.08 in early Monday trading, a relatively muted investor reaction likely due to lingering uncertainties about solithromycin's future. Cempra's market value was cut in half last week following the FDA's harsh clinical review of solithromycin highlighted the drug's toxic liver profile and raised doubts about its approvability.
Friday's vote was a narrow victory for Cempra but one that might not matter. The FDA makes the final approval decision and is not bound by the recommendation of its advisory panels.
Some of the experts on the FDA panel were swayed to vote in favor of solithromycin because of the urgent medical need for new antibiotics to battle resistant bacteria. Still, they expressed serious concerns for pneumonia patients placed at higher at risk for liver injury because of solithromycin.
By a 12-1 vote, the expert panel also concluded Cempra did not have sufficient clinical data to properly characterize the risk of serious liver injury due to solithromycin. The FDA, in its own review of the antibiotic, raised the same concerns.
The ability of solithromycin to combat infection was confirmed in a 13-0 positive vote by the same expert panel.
There was almost unanimous consensus that Cempra needs to collect additional liver safety data on solithromycin but it's up to the FDA to decide if those data need to be gathered before the antibiotic is approved or after it's already on the market.
Cempra will certainly lobby for a post-marketing liver toxicity data program, but even if the FDA agrees, restrictions on the use of solithromycin in patients are likely to be so severe as to make the product commercially unviable.
That's exactly what happened to Ketek, a similar antibiotic, when regulators restricted use because of liver toxicity.
The FDA is expected to make an approval decision on solithromycin by Dec. 27. Cempra is also dealing with a solithromycin manufacturing issue with one of its suppliers that could delay approval.
Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.