FDA Rejects Northfield's Application for a Blood Substitute

The company hasn't yet said what drug regulators found lacking.
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Northfield Laboratories

(NFLD)

said late Monday that U.S. drug regulators have refused to accept the company's filing seeking approval for an oxygen-carrying blood substitute.

The Evanston, Ill.-based company is developing PolyHeme for use in patients in trauma situations where large quantities of blood have been lost. Northfield filed its approval application for PolyHeme with the Food and Drug Administration on Aug. 28.

Monday, Northfield said the FDA's refusal-to-file letter included questions and comments about PolyHeme that the company would work to address over the next several months.

The company did not say what sorts of questions or issues were raised, nor did it say if new clinical trials would be necessary. There was no response at the company headquarters to a call made shortly after the news was released, just before 7 p.m. EST.

But the absence of detail about the clinical testing of PolyHeme has become a sort of trademark for the company, which rarely communicates with the media, investors or Wall Street analysts. In fact, Northfield took most blood- substitute experts by surprise with its Aug. 28 FDA filing because few were even aware that the company had actually finished clinical testing.

Northfield's short-term cash reserves are dwindling, which could make life at the company difficult if the FDA requires another lengthy and expensive clinical trial. As of Aug. 31, the company had $4.5 million in cash and another $21.6 million in marketable securities in its corporate coffers. The company already has acknowledged that it must raise another $40 million to fund the construction of a small-scale manufacturing facility for PolyHeme. Financing additional clinical trials will only add to the company's cash needs.

Northfield shares closed Monday down 16 cents to $13.25 per share.