Chelsea Therapeutics (CHTP) Remains Outperform at Wedbush Despite Negative FDA Briefing Docs

January 10, 2014 11:48 AM EST
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Price: $6.52 --0%

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Wedbush reiterated an Outperform rating on Chelsea Therapeutics (NASDAQ: CHTP) with a price target of $8.00. The stock declined following negative FDA briefing documents.

"The summary of reviewer Dr. Melanie Blank in 2012 was included, and presented arguments both in support and against approval of Northera with the existing data. She reiterated her argument that she sees short-term efficacy in study '301; however, she believes one week of treatment is insufficient for a drug given chronically and would like a longer-term (three months treatment) study. She also feels one successful study is insufficient. Of note, she did not consider the successful study '306b in her summary comments—only '306a. She also continues to have safety concerns due to lack of a "proper" placebo arm, in her view. The second reviewer, Dr. Shari Targum recommended a complete response "for inadequate evidence of effectiveness" instead of approval after criticizing both the '301 and '306 trial designs and results. It is clear that both reviewers remain negative on approving Northera," said analyst Liana Moussatos.

"The reviewers brought up no material new arguments against approval, in our view, and in February 2012, the previous panel recommended approval (7-4)—so we anticipate the panel on January 14th is likely to also recommend approval. Trading for CHTP is likely to be halted during the panel meeting; however, we could see some recovery on January 15th with a positive recommendation. The PDUFA is February 14th. We give approval a 50:50 chance," said the analyst.

For an analyst ratings summary and ratings history on Chelsea Therapeutics click here. For more ratings news on Chelsea Therapeutics click here.

Shares of Chelsea Therapeutics closed at $3.53 yesterday.

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