Aquestive Therapeutics Inc. (NASDAQ: AQST) has announced that it had received a Complete Response Letter (CRL) from the U.S. Food and Drug Administration (FDA). Usually, these letters spell disaster for firms in the biopharmaceutical industry, and Aquestive shares were crushed on Monday.

The FDA issues CRLs to indicate that the review cycle for an application is complete but the application cannot be approved in its current form. This CRL was in reference to Aquestive’s New Drug Application (NDA) for Libervant (diazepam) Buccal Film for the management of seizure clusters. In the CRL, the FDA cited that certain weight groups in the study showed a lower drug exposure level than desired.

The company intends to provide to the FDA additional information on pharmacokinetic modeling to demonstrate that dose adjustments will obtain the desired exposure levels. No other safety, clinical pharmacology/biopharmaceutics or Chemistry, Manufacturing and Controls issues were identified in the CRL.

The FDA did cite a small number of protocol deviations in blood draws in one of the studies in the NDA. Aquestive’s management believes, based on discussions with the FDA, that the company will not need to conduct any further clinical studies in order to cure the items cited in the CRL, and it will confirm that view in its upcoming follow-up meeting with the FDA.

Looking ahead, the firm believes that this CRL will not be a barrier to ultimate approval, as the CRL was limited to providing additional information on pharmacokinetic modeling for an adjusted dosing regimen for a limited subset of patient weight categories.

Aquestive stock traded down about 35% Monday morning to $4.92, in a 52-week range of $1.41 to $10.00. The consensus price target is $17.83.

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