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Auryxia production halt sends Keryx stock price plummeting
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The share price of dialysis drug maker Keryx Biopharmaceuticals went down almost 48% this week after the company announced it was temporarily halting manufacturing of its Auryxia oral phosphate binder due to production-related issues.
The company stock price hit a year-high of $7.80 on Friday, having risen steadily since January. The announcement about interrupting production of Auryxia brought the stock price down to $4.17 on Tuesday. The company withdrew its FY forecast due to the production issues. Auryxia, launched in December 2014, is the company’s only FDA approved product.
Keryx says the supply halt is not safety-related, but connected with its drug product manufacturer. The manufacturer turns active ingredients of Auryxia into the product’s tablet form. “In the past few months, we began experiencing difficulties converting active pharmaceutical ingredients or API, to finish drug product, which resulted in variable yields, as compared to our historical rate,” said company president and CEO Greg Madison during an earnings call on Monday. “We had been management supply levels efficiently even with increased demand generated by our field team in the second quarter. Last week our CMO notified us that a production issue reoccurred in their latest run and we agreed to stop production to identify the cause. As a result of halting production combined with the previous low yields and increased demand, we've exhausted our reserves of finished drug tablets. At this time, current inventories held by wholesalers and direct customers will not be sufficient for patients to continue filling prescriptions.”
Madison said the company will bring on an additional contractor which is currently under review with the FDA. That company has already had several production runs of the drug, and Keryx believes the finished tablets already on hand coupled with the additional production runs scheduled with this manufacturer “would allow us to come back to the market during the fourth quarter pending FDA approval of the site,” which is anticipated on November 13, Madison said.
For the second quarter, Keryx reported $8.3 million in Auryxia sales, driven by 44% growth in prescriptions. Total operating expenses, excluding cost of goods and license expense, for the quarter were $27.2 million. -by Mark Neumann