Why FibroGen was crashed on Monday
What happened
FibroGen ( FGEN 3.35% ) not starting the week very well. On Monday, investors drove its stock price down 9%. This appears to be punishment for the company’s post-market announcement the previous trading day that the approval process for a crucial pipeline drug will take longer than expected.
So what
The drug in question in the promising promises of FibroGen roxadustat, which treats the anemia of chronic kidney disease. The company announced that the Food and Drug Administration (FDA) review of the company’s New Drug Application (NDA) for roxadustat has been extended for three months. The new action date is March 20, 2021.
As the original action date was today, investors face disappointment over FibroGen’s failure to secure a regulatory present in time for the holidays and roxadustat’s inability to enter the new year as a as a marketable drug.
the biotechnologies said the FDA is “close to finalizing” the NDA. FibroGen is busy submitting additional analyzes of the drug’s clinical data.
Now what
NDA exam extensions aren’t out of the ordinary, and most of the time, they’re not worth worrying about. Professionals who follow FibroGen shares don’t seem worried – on Monday, for example, Mizuho Securities analyst Difei Yang reiterated his buy rating on it, along with his price target of $72 per share. .
As this level is 80% above the current post-sale share price, this confidence is notable – and, in my opinion, justified, given the very good potential of roxadustat.
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