By Mariam ESunny and Raghav Mahobe
(Reuters) -The U.S. Food and Drug Administration on Tuesday approved Reata Pharmaceuticals Inc’s drug for the treatment of a rare genetic disorder that causes progressive damage to the nervous system, sending shares up nearly 160% after the bell.
The drug, Skyclarys, is Reata’s first product to gain approval, and Jefferies analyst Maury Raycroft projected that U.S. sales of the drug could reach $400 million by 2030.
Reata estimates the disorder, called Friedreich’s ataxia, affects about 5,000 patients in the United States.
Friedreich’s ataxia is a neuromuscular disorder that causes muscle weakness, loss of coordination and can lead to patients being bound to a wheelchair in their mid-20s and premature death.
Raycroft, before the FDA decision, estimated the drug could be priced at about $425,000 per patient annually.
Reata’s case for approval was based on additional data requested by the FDA and a mid-stage study that the drugmaker said showed patients who took the drug experienced an improvement in neurological functions such as speaking, swallowing and standing, compared with a placebo.
The FDA said in 2020 there was not enough evidence to support approval based on the single study, but Reata has since then submitted additional analyses, stopping short of conducting another clinical trial.
The FDA has previously approved drugs for neurological conditions based on limited data such as for Biogen Inc’s Alzheimer’s drug Aduhelm and Amylyx’s ALS drug.
Those approvals were made under the leadership of Billy Dunn, who resigned from the agency on Monday after which Reata’s shares tumbled 30% as investors fretted about the possibility of approval under a new division head.
(Reporting by Raghav Mahobe, Mariam E Sunny and Pratik Jain in Bengaluru; Editing by Krishna Chandra Eluri and Sherry Jacob-Phillips)
