(Adds information on MS and how fampridine-SR works in the last paragraph and updated stock price.)
By Jennifer Corbett Dooren
Of DOW JONES NEWSWIRES
WASHINGTON -(Dow Jones)- A proposed Acorda Therapeutics (ACOR) drug to treat multiple-sclerosis increased walking speed, but U.S. Food and Drug Administration staff questioned whether the improvement was clinically meaningful.
The news sent Acorda's stock down 22% to $17.35 recently on more than 12 times its regular trading volume, as the FDA's questions seemed to dent confidence in the drug's swift approval.
The proposed drug fampridine-SR faces a review by an FDA panel of outside medical experts next Wednesday. The FDA posted its review of the drug on its Web site Friday.
The panel is being asked to vote on whether it thinks the drug is safe and effective at improving the walking of patients with MS. The panel will also be asked if Acorda should be required to study the drug at a lower dose.
Robert Baird & Co. analyst Christopher Raymond urged clients to stay on the sidelines, because of the risk related to the panel meeting and the agency's concerns of the drug's effectiveness, despite two positive clinical trials.
Raymond believes that the stock's decline points to expectations of a delayed approval, rather than an "outright dismissal" of the drug from the FDA.
But JPMorgan analyst Geoffrey Meacham believes the agency's questions aren't surprising and that the data on the drug will withstand regulatory scrutiny.
"Overall, we'd recommend purchase on weakness ahead of the Oct. 14 panel discussion, as we believe that a fulsome discussion will lead to a recommendation for regulatory approval," Meacham wrote to clients.
The active ingredient in the drug - fampridine - has been compounded in pharmacies for more than 20 years and used to improve walking in a number of neurological conditions. The drug is currently not approved by the FDA for any use. Fampridine has been associated with a risk of seizures especially at higher doses of the drug than the 10-milligram dose for which Acorda is seeking approval.
The FDA said data from the clinical trial of fampridine-SR at 10-milligrams given twice a day didn't show a difference in the seizure risk compared to patients treated with a placebo, or fake drug. However, the agency said there was a 10-fold increase in the risk of a seizure when the drug was dosed at 20-milligrams twice daily, "a concerning finding suggesting a narrow therapeutic index."
Acorda is planning a risk-management program that would include educating patients and doctors about the importance of sticking to the 10-milligram dose and not taking two pills at once, for example.
In a document also posted to FDA's Web site, Acorda noted that walking impairment is one of the most common side-effect related to MS and said there's currently no FDA-approved treatment that directly addresses walking impairment.
"Fampridine-SR offers people with MS the potential for improvement of walking ability, an important unmet need with a low risk of intolerable or severe adverse effects," Acorda said.
Multiple-sclerosis is a progressive disease that involves damage to nerves controlling muscles and vision, and affects about 400,000 Americans. The condition causes the body's immune system to eat away at the protective covering of the nerves, or myelin, which disrupts the electrical signals between the brain and the rest of the body. Fampridine-SR is designed to help the body's electric signals to pass through by blocking potassium ions that leak from the damaged nerves.
-By Jennifer Corbett Dooren, Dow Jones Newswires; 202-862-9294; jennifer.corbett@dowjones.com
(Thomas Gryta contributed to this report.)