DUBLIN, Ohio (


) --



1: Hedge fund short-seller 0

Wednesday night, Neoprobe said U.S. regulators accepted the company's new drug application for Lymphoseek, a new lymph-node mapping agent used to determine the spread of cancer. Neoprobe filed Lymphoseek with the U.S. Food and Drug Administration in August.

Normally, FDA acceptance of an approval filing isn't big news; the FDA approval decision that comes later is much more significant. Neoprobe was an unusual case, however, due to the very public campaign last June waged by MSMB Capital hedge fund manager Martin Shkreli, who

shorted Neoprobe and then filed a citizen petition

with FDA seeking to prevent the agency from reviewing Lymphoseek.

Shkreli alleged that Neoprobe's clinical studies of Lymphoseek were flawed and therefore the data collected from the studies weren't strong enough for the basis of a new drug application.

Neoprobe denied Shreli's allegations, insisting that the Lymphoseek studies were conducted correctly and with feedback from the FDA.

With the FDA's acceptance of the Lymphoseek application Wednesday, Neoprobe has been proven right; Shkreli wrong.

Whether FDA decides to approve Lymphoseek is an unsettled question. Neoprobe has not yet disclosed an FDA approval decision date, but it's likely to come next June.

Neoprobe shares closed Wednesday at $2.63, ahead of the Lymphoseek announcement.

Lymphoseek is a proprietary radioactive tracing agent designed for use during a surgical procedure known as intraoperative lymphatic mapping (ILM) or sentinel lymph node biopsy (SLNB). ILM is performed on patients during cancer surgery to determine if cancer has metastasized, or spread, from the primary tumor site into the lymph nodes. Once cancer gets into the lymphatic system, it can spread more easily to the rest of the body.

To prevent cancer from spreading, doctors perform an ILM procedure to identify which lymph nodes are closest to the tumor. Once these lymph nodes are found, doctors can remove them and test to see if they're cancerous. Most ILMs performed in the U.S. today rely on a combination of vital blue dye and an off-label radioactive tracing agent to map out lymph nodes.

--Written by Adam Feuerstein in Boston.

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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;

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