Ladenburg Thalmann downgraded Ardelyx (NASDAQ:ARDX) to “neutral” from “buy” and removed its price target, citing an unproductive post-complete response letter (CRL) Type A meeting with the FDA. The stock closed at $1.09 on Oct. 13.
Analyst Matthew Kaplan writes that the CRL was in response to the tenapanor NDA for the control of serum phosphorus in chronic kidney disease (CKD) patients on dialysis.
In the CRL, the FDA questioned “the clinical relevance of the small treatment effect” and would require an adequate and well-controlled trial to demonstrate “a clinically relevant treatment effect on serum phosphorus or an effect on the clinical outcome thought to be caused by hyperphosphatemia in CKD patients on dialysis.”
While Ardelyx has not yet received minutes from the FDA meeting, the company was not provided sufficient clarity with respect to what constitutes “clinical relevance of the magnitude of treatment effect,” according to Mr, Kaplan.
“Although we continue to view tenapanor as a potential transformational therapy for the treatment of hyperphosphatemia in CKD … significant uncertainties remain with respect to the exact path forward,” he added.