Biohaven Stock Hits 52-Week Low, Cuts R&D Spending After FDA Rejection

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Biohaven Ltd. (NYSE:BHVN) stock plummeted on Wednesday, reaching its 52-week low, according to data from Benzinga Pro.

• BHVN is testing key support levels. View the charts here

The U.S. Food and Drug Administration (FDA) issued a Complete Response Letter (CRL) to Biohaven's New Drug Application (NDA) seeking approval of Vyglxia (troriluzole) for spinocerebellar ataxia (SCA).

FDA cited issues that can be inherent to real-world evidence and external control studies, including potential bias, design flaws, lack of pre-specification, and unmeasured confounding factors.

Also Read: Biohaven Advances Toward Potential First FDA-Approved Therapy For Spinocerebellar Ataxia, FDA Drops Advisory Meeting

Prior to 206-RWE protocol finalization, study approval, and topline data analysis, the FDA provided feedback on the study's statistical analysis plan and study protocol, which were incorporated into the IRB-approved study.

The FDA official meeting minutes (March 8, 2024) from the discussion of the RWE study included the statement, "a large and robust treatment effect would be needed to overcome the biases of an externally controlled trial, for it to be used as the primary basis for substantial evidence for effectiveness."

Biohaven believes the statistical significance and clinical meaningfulness achieved on the primary endpoint and eight consecutive secondary endpoints in 206-RWE clearly met the criteria of  "a large and robust treatment effect."

Biohaven will prioritize its resources to focus all R&D efforts on other key programs.

Biohaven has initiated strategic portfolio and cost optimization, focusing on restructuring business priorities to achieve an approximately 60% reduction in annual direct R&D expenses.

The company may pause or delay non-priority programs to maintain its cash runway, focusing on its priority clinical-stage programs over the next year.

Analyst Take

William Blair downgraded Biohaven from Outperform to Market Perform. Analyst Myles R. Minter says that as the FDA has now been restrictive to both uniQure' N.V.'s (NASDAQ:QURE) and Biohaven's comparisons to natural history as a regulatory path forward in rare neurological

disorders, they await regulatory clarity.

Analyst Minter sees risk around the company's ability to fund the development of its prioritized pipeline.

William Blair also notes that the company will require additional capital to continue funding its pipeline or explore strategic alternatives for its deprioritized pipeline assets.

BHVN Price Action: Biohaven shares were down 36.63% at $8.84 at the time of publication on Wednesday. The stock is trading near its 52-week low of $12.79, according to Benzinga Pro data.

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