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 The news is a blow for Shire, which is to trying to buy Baxalta Inc
to forge the leading global specialist in rare diseases, and has
already seen the value of its all-share offer, initially worth $30
billion, fall by more than a fifth.
Flemming Ornskov, Shire's chief executive, said he was
"disappointed" but his company continued to plan for a potential
2016 launch of lifitegrast. It will have data from a Phase III trial
later this year that could satisfy the U.S. regulator.
"If the study is positive, we plan to refile our liftegrast
submission in the first quarter of 2016, and will remain on track
for the planned lifitegrast launch next year," Ornskov said in a
statement.
The Irish company announced the setback in the all-important U.S.
market late on Friday. Industry analysts view lifitegrast as a
potential $1 billion-a-year-plus seller, making it an important
future driver of Shire profits.
Jefferies analysts said the FDA decision to issue a so-called
complete response letter was likely a temporary setback. Such
letters are sent out to let a drug developer know a marketing
application will not be approved in its present form.
"We continue to assume lifitegrast will be approved, partly because
the FDA has effectively indicated the only other prescription drug
on the market (Allergan's Restasis) has marginal efficacy, setting a
relatively low bar," they wrote in a note.
Chronic dry eye syndrome affects the eye's tear-producing glands,
causing patients to suffer from blurred vision and an itching or a
burning sensation in the eyes.
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Shire's stock has been hit both by uncertainty over the Baxalta bid
and a wider rout in pharmaceutical stocks, triggered by mounting
investor concerns about political pressures on U.S. drug prices.
Shire, as a major producer of treatments for rare diseases, makes
some of the most expensive drugs in the world.
There has recently been speculation that Shire might turn its
attention from Baxalta to a more manageable target like Radius
Health, which has a market value of just under $3 billion.
(Editing by David Holmes)
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