NeurogesX, Inc. (NASDAQ: NGSX) is seeing shares plunge after the Food & Drug Administration issued a complete response letter denying approval for the company’s Qutenza patch to assist with HIV-related pain symptoms. Fierce Biotech noted, “As expected, the FDA has rejected NeurogesX’s application to expand the use of Qutenza, which clearly came as no surprise to management.”
Unfortunately, the company is letting go of more than half its staff. The company will now focus on another program and on maintaining and raising capital.
The latest move indicates that 43 workers will be fired and 32 workers will be left to set up a late-stage study of NGX-1998 in postherpetic neuralgia. The company will not be investing further into Qutenza.
What we want to know is whether or not the company can even attract new capital based upon NGX-1998 or other prospects.
A 19% drop was down to $0.532 today and the 52-week trading range is $0.50 to $4.47. The market cap is a mere $15.8 million.
R&D expenses were $2.4 million in the fourth quarter and selling, general and administrative expenses for the fourth quarter of 2011 were $7.5 million. Cash, cash equivalents and short-term investments were $34.3 million at December 31, 2011, but the company did complete a $3 million private placement since the end of the year. If you tally up all of the assets and liabilities, NeurogesX has more liabilities than it does assets.
It is fair to ask… Can this company survive?
JON C. OGG
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