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Mayne Pharma (ASX:MYX) share price dives 16% on FDA update

falling asx share price represented by piggy bank wearing doctor's mask having fallen over
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It has not been a great day for Mayne Pharma Group Ltd (ASX: MYX) shareholders. The Mayne Pharma share price has tanked today following a setback on its new drug application for a generic version of Nuvaring.

At the time of writing, the Mayne Pharma share price is heavily down 15.79% to 32 cents.

What does Mayne Pharma do?

Mayne Pharma is a pharmaceutical company that focuses on the delivery and commercialisation of branded and generic drugs. The technology-driven business provides contract development and manufacturing services to more than 100 clients worldwide. Its global reach spans across Australia, North America, Europe and Asia. The business is supported by over 900 staff and 200 scientists formulating new oral and topical drugs.

What happened?

The Mayne Pharma share price has, to a lesser extent, today mimicked the fall of Mesoblast Limited (ASX: MSB) last week when that company received its own update from the United Stated Food and Drug Administration (FDA). As was the case with Mesoblast, the FDA issued a complete response letter to Mayne Pharma.

The FDA has raised questions in relation to the company’s generic version of the drug Nuvaring. In response, Mayne Pharma advised it was working closely with its development partner, Mithra Pharmaceuticals to address the issues.

Mayne Pharma noted that following its resolution of the FDA’s concerns, a new target action date will be set for its new drug application (NDA).

Mayne Pharma CEO, Scott Richards, remains driven to have the company’s generic Nuvaring drug available to the market. He said:

We are confident we can address the issues raised in the letter in a timely manner. Pleasingly, the FDA has indicated that Mayne Pharma and its development partner Mithra have an acceptable manufacturing process for generic Nuvaring. Furthermore, the market opportunity continues to be highly attractive with only one independent generic approved and an addressable market of US$920m.

In addition to the news, the company also participated in a mid-cycle review meeting with the FDA regarding its Nextstellis drug. Mayne Pharma stated that it did not receive notification of any significant issues or major safety concerns. The company said that the meeting signalled the halfway mark to its NDA review process. It expects to be granted commercialisation rights of the novel oral contraceptive within six months

About the Mayne Pharma share price

The Mayne Pharma share price has risen 60% since falling to its 52-week low of 20 cents in March. Although now materially lower, before the news today, the Mayne Pharma share price was up almost 12% since the start of last month.

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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.