William Blair downgraded Acer Therapeutics (NASDAQ:ACER) to “market perform” from “outperform” after the company received a complete response letter from the FDA for its lead product, Edsivo (celiprolol).
In early trading on June 25, the stock was quoted at $4.44, down $14.84, or 77%, in heavier than normal turnover.
Edsivo is in development for the treatment of vascular Ehlers-Danlos Syndrome (vEDS) in patients with a confirmed COL3A1 mutation.
Analyst Tim Lugo writes that the FDA is requesting a “new adequate and
well-controlled clinical trial prior to approval, which we believe will likely require several years for execution.”
Given the disappointing FDA decision and the uncertain future of celiprolol for the treatment of vEDS, “we have also adjusted our estimates to exclude an approval for Edsivo in the near term given today’s news,” he added.
“While the company holds a pipeline outside of Edsivo, the remaining opportunities will still require clinical development and, given today’s setback, we will wait for execution from the company in developing ACER-001 in urea cycle disorders, maple syrup uremic disorder and unnamed indications for the recently in-licensed osenatant,” Mr. Lugo said.
