Capricor Therapeutics Inc. (NASDAQ:CAPR) saw its shares plummet over 60% on Monday, following the release of FDA briefing documents that raised significant concerns about the efficacy of its investigational cell therapy, Deramiocel, for Duchenne muscular dystrophy (DMD). The stock decline occurred ahead of an FDA Advisory Committee meeting scheduled for July 29, which will review the therapy's data.
FDA Concerns on Efficacy
The FDA's briefing document indicated that the data from Capricor's pivotal Study HOPE-3, when considered alongside results from Study HOPE-2, did not provide substantial evidence of effectiveness for Deramiocel. The document noted that Study HOPE-3 failed to meet its primary efficacy endpoint, with results showing small and variable changes in upper limb muscle function that did not reach statistical significance.
Allegations of Fraud
Adding to the turmoil, Martin Shkreli, a controversial figure in the pharmaceutical industry, publicly accused Capricor of fraud, claiming that the company's CEO Linda Marbán and a statistics consultant manipulated patient data. In response, Marbán defended the integrity of Capricor's clinical data, stating,
We stand firmly behind the integrity of our data and our clinical program, and look forward to discussing the totality of evidence for Deramiocel at our upcoming FDA Advisory Committee meeting.
Legal Challenges
Compounding these issues, Capricor has filed a lawsuit against Nippon Shinyaku and its U.S. subsidiary NS Pharma, alleging that the pricing terms of their distribution agreement for Deramiocel could restrict patient access, particularly for those reliant on Medicare and Medicaid.
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The significant drop in Capricor's stock is likely to impact investor sentiment in the biotech sector, particularly for companies involved in rare disease therapies. The upcoming FDA meeting will be closely watched by investors, as its outcome could influence the future of similar investigational therapies.
Investors will watch for the results of the FDA Advisory Committee meeting on July 29, which will determine the fate of Deramiocel.