Investors have reacted positively to recent news from the FDA.
Shares of Applied Therapeutics (APLT) surged by 70.5% as of 10:43 a.m. ET on Wednesday following an announcement from the U.S. Food and Drug Administration (FDA). The FDA informed the company that an Advisory Committee meeting to review the New Drug Application (NDA) for govorestat, a treatment for galactosemia—a rare genetic metabolic disease—would no longer be necessary.
Initially, the FDA had tentatively scheduled an Advisory Committee meeting for October 9, 2024, to evaluate the NDA for govorestat. The agency now believes it can proceed with the approval decision on the drug without consulting external experts. The FDA has set a Prescription Drug User Fee Act (PDUFA) date of November 28, 2024, for this decision.
The cancellation of the Advisory Committee meeting is significant for Applied Therapeutics. Such meetings often carry the risk of increasing the chances that a drug will not be approved, as the FDA typically follows the recommendations from these committees. With the Advisory Committee meeting no longer scheduled, the likelihood of govorestat receiving FDA approval has potentially increased.
Regarding the investment potential of Applied Therapeutics, the company’s significant gains this year appear justified. The outlook for govorestat in treating galactosemia is encouraging. Additionally, the company is investigating the drug in a late-stage clinical trial for treating sorbitol dehydrogenase (SORD) deficiency, another rare genetic metabolic disorder.
From an investment perspective, Applied Therapeutics remains an attractive option. The likelihood of the company achieving its first FDA approval in the near future appears strong. An approval from the FDA is also expected to heighten investor enthusiasm about the potential for subsequent approval in the treatment of SORD deficiency.
Keith Speights, the author of the original article, holds no position in any of the mentioned stocks, and The Motley Fool also has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
