Dynavax Technologies Corporation (NASDAQ:DVAX) obtained a CRL from the U.S. FDA pertaining it’s BLA for HEPLISAV-B. The concerns posted by the FDA appeared minor. However, the eventual acceptance of HEPLISAV-B is still in doubt.
The highlights
Dynavax obtained a Complete Response Letter regarding its application of HEPLISAV-B as a drug for Hepatitis B. After the CRL obtained by the firm in 2012, the management reshuffle happened. The positive data released for the HBV-23 trial definitely puts into doubt management’s ability to implement on the company’s vision. However, existing shareholders are faced with this dilemma: jump out or stay in for the jump in prices, while many still have money left. This CRL addresses many questions than those talked about previously.
As per the FDA, a response letter offers a neutral and more consistent mechanism to show that initial assessment of an application is closed and they cannot permit the application in its current form. It is not an absolute rejection, far from it, essentially.
The CRL seeks data pertaining to numerous topics, including explanation concerning specific AESIs, a numerical disparity in a small count of cardiac events in a single trial (HBV-23), new evaluations of the integrated safety information base across different periods, and post-marketing pledges.
Dynavax Technologies is not a cash-rich firm. As of 3Q2016, the firm recorded cash and cash equivalents of $109.9 million. The burn rate is nearly $34 million. Moreover, if the burn rate fails to decline, the firm has nearly three quarters worth of funds. In October, the firm finalized a note purchase deal with Deerfield Management, following which Deerfield had accepted to purchase $100 million worth of company’s 10.375% Senior Secured Notes upon the nod of HEPLISAV-B by the U.S. FDA.
If the deal is still applicable, it won’t permit the firm to support itself until the U.S. FDA sanction of HEPLISAV-B. It is dependent on the nod itself and was believed to fund commercialization measures.
