FDA advisory committee votes 10-8 in favor of ChemoCentryx’s experimental drug; stock is down

Shares of ChemoCentryx Inc. tumbled 61.7% in trading on Friday, the day after a Food and Drug Administration advisory committee voted 10-8 that the benefits of the company’s experimental autoimmune drug, avacopan, outweigh the risks. The mixed response from committee members followed critical words from the FDA earlier this week that had sent ChemoCentryx’s stock diving. The company’s stock this week was downgraded by Raymond James and Stifel Nicolaus, among others. Raymond James analyst Steven Seedhouse told investors that while he downgraded the stock to outperform, from strong buy, he still predicts a FDA approval by July 7 and a future blockbuster in avacopan, which is being evaluated as a treatment for anti-neutrophil cytoplasmic auto-antibody-associated vasculitis. “We’re actually not changing our unadjusted avacopan estimates (~$1.9B peak unadjusted U.S. sales), only our probability of success (now at 50% vs. 100% prior),” he wrote. “Yes, we’re calling this a pure coin flip between now and July 7.” ChemoCentryx’s stock is down 54.4% for the year, while the broader S&P 500 is up 11.8%.

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