Genzyme got some bad news today from the FDA. The Cambridge, MA-based biotech company said that U.S. regulators determined its drug for Pompe disease made in large-scale vats isn’t ready to be approved for the market. Plus, the FDA sent the company an additional warning letter after its inspectors spotted “deficiencies” at the company’s Allston Landing factory during inspections performed in September and October.
The company (NASDAQ: [[ticker:GENZ]]) said it expects to get together all the information it needs to respond to the FDA’s concerns in one month, and that it should be able to resolve the agency’s questions within three to six months. Since it wasn’t counting on this delay, the company says it will have to shave 12 cents a share off its annual profit forecast, to about $4.58 a share on a pro forma basis.
“We have disappointed ourselves,” said Genzyme CEO Henri Termeer, on a conference call with analysts. “We were hoping, expecting, working to get this resolved in the February time frame.” He added: “We will work very hard,” to bring the drug to patients.
Genzyme has been working for more than two years to make its drug for Pompe disease, an inherited neurological disorder that appears in about 1 out of every 40,000 live births, more widely available. The drug, alglucosidase alfa, (Myozyme) was first approved in the U.S. in April 2006. Genzyme has struggled to prove to the FDA that the product it makes in a smaller, 160-liter vat is consistent with what it produces on a 2,000-liter and 4,000-liter scale. The drug, which costs about $300,000 per year per patient, has had better luck overseas, where it has been cleared for sale in more than 40 countries at the 2,000-liter scale. And the company won approval for the 4,000-liter-scale product just a few days ago from the European Commission. Genzyme calls the drug made at the larger scale Lumizyme.
The company had been expecting to generate $430 million to $440 million in sales of Myozyme this year, up from $296 million in 2008. It is the company’s third-biggest selling drug for genetic diseases, trailing imiglucerase (Cerezyme) and agalsidase beta (Fabrazyme).
Genzyme stock fell $3.12 to $53.40 in after-hours trading following the announcement.
