It’s a no for me, FDA rejects Biohaven’s (NYSE: BHVN) SCA treatment

Biohaven (NYSE: BHVN) stock fell 44% after the U.S. Food and Drug Administration (FDA) issued a Complete Response Letter (CRL) for the company’s New Drug Application for VYGLXIA (troriluzole), rejecting its approval for spinocerebellar ataxia (SCA).

The FDA cited concerns related to the real-world evidence study that formed the basis of Biohaven’s application, pointing to potential bias, design flaws, lack of pre-specification, and unmeasured confounding factors. This rejection comes despite the study showing a 50-70% slowing of SCA disease progression in treated patients compared to matched untreated controls.

Following the setback, Biohaven announced a significant restructuring, including an approximately 60% reduction in annual direct R&D spending. The company will now prioritize three key clinical programs: extracellular degraders for IgA nephropathy and Graves’ disease, opakalim for epilepsy and depression, and taldefgrobep alfa for SMA and obesity.

“The CRL for Vyglxia is highly disappointing, and we are unsure if it will ever make it to market,” noted TD Cowen analyst Tyler Van Buren, who lowered his price target on Biohaven to $15 from $50 while maintaining a Buy rating.

Baird analyst Brian Skorney also reduced his price target to $42 from $52, maintaining an Outperform rating, noting that while the rejection eliminates Biohaven’s most near-term opportunity to offset its high burn rate, he believes “the degrader platform is worth a multiple of the current stock price.”