Columbia Laboratories Inc. fell the most in almost five years after a panel advising U.S. regulators didn’t back the company’s gel to prevent preterm births.
Columbia Labs (CBRX) plunged 55 percent to 71 cents at the close in New York, the biggest one-day decline since February 2007. The medicine, called Prochieve, is being developed with Parsippany, New Jersey-based Watson Pharmaceuticals Inc. (WPI) Watson shares fell 1.6 percent to $57.21.
The advisory panel to the U.S. Food and Drug Administration voted at a Jan. 20 meeting that trial data didn’t prove the progesterone gel prevented mid-trimester births in women with short cervixes. The regulator is scheduled to decide whether to approve the treatment by Feb. 26 and isn’t required to follow the panel’s recommendations. The panel said a new study might be needed before it could recommend the medicine.
“The path forward for Prochieve is highly uncertain,” Michael Tong, a senior analyst with Wells Fargo & Co. in New York, said in a note to clients today. “We believe WPI could even elect to terminate development of Prochieve,” he wrote.
Columbia, based in Livingston, New Jersey, had $45.7 million in 2010 revenue, and has five products on the market, according to its website. Columbia’s management had suggested peak sales in preterm birth prevention may reach as high as $275 million, Tong said on Jan. 17.
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