Shares of Savient Pharmaceuticals Inc. Soar Despite FDA Concern Over Drug Safety (SVNT)

Shares of Savient Pharmaceuticals Inc. (Nasdaq: SVNT) climbed on Friday after an announcement by the FDA that the company’s drug Krystexxa appears to successfully treat gout, despite evidence of potentially deadly side effects.

Savient ended the day on Friday up 3.33 (56.16%) with a closing price of 9.26.

The FDA said that the drug appears to relieve swollen joints and pain flare- ups associated with gout, a condition caused by the buildup of uric acid in the body.

Krystexxa is an injectable enzyme designed to lower the body’s uric acid levels when administered either once or twice a month. Gout affects about 8 million Americans and is most commen in men over 40, according to the FDA.

Safety concerns were raised as side effects such as heart problems and allergic reactions were witnessed during clinical trials.

Dr. Bob Rappaport, head of the FDA division that handles rheumatology drugs, is quoted as saying, “The Food and Drug Administration’s review of two company studies raised several concerns, including a greater number of patients taking Krystexxa who suddenly died or had heart failure as well as allergic reactions.”

About 24 percent of patients taking Krystexxa suffered a serious side effect, compared with 12 percent of patients taking a placebo pill. There were six deaths among patients taking the drug compared with three among patients taking the placebo, though the FDA noted many of them had pre-existing heart conditions.

The FDA is scheduled to ask a panel of outside arthritis experts next Tuesday to weigh- in on the drug’s risks and benefits. The panel would determine whether additional studies would be needed to evaluate Krystexxa’s impact on the heart. A final decision on Savient’s drug is expected by the end of July.

Collins Stewart analyst Salveen Kochnover said that Savient’s drug can likely win approval so long as the company agrees to limit its use to the target patient population and closely monitors any negative side effects. Savient is specifically seeking an alternative for gout patients who are not receiving relief from other treatments.

Kochnover also noted that seven of the 16 panelists slated to vote on the drug are rheumatologists who are likely in favor of the new treatment.

Joshua Sherman