Dell falls as soft current quarter guide offsets Q2 beat, full-year outlook lift
On Tuesday, TD Cowen analysts lowered the stock rating for Milestone Pharmaceuticals (NASDAQ:MIST) from Buy to Hold. The change comes following the company’s receipt of a Complete Response Letter (CRL) from the U.S. Food and Drug Administration (FDA) for its New Drug Application (NDA) for etripamil, a treatment for paroxysmal supraventricular tachycardia (pSVT). This regulatory setback has affected the company’s immediate launch plans for the drug and sent shares tumbling 57% in the past week to $0.80, near its 52-week low of $0.75. According to InvestingPro analysis, the stock is currently trading below its Fair Value.
TD Cowen also suspended the price target for Milestone Pharmaceuticals, citing uncertainties surrounding the regulatory approval and commercial launch timing of etripamil. The analysts expressed concerns over the new issues raised by the FDA regarding the drug’s functionality which have made the timelines for NDA resubmission unclear. With a market capitalization of just $53 million and an overall Financial Health Score rated as ’Weak’ by InvestingPro, the company faces significant challenges ahead.
The commercial prospects for etripamil are further challenged by Milestone Pharmaceuticals’ current financial position. While the company maintains a strong current ratio of 9.1, indicating solid short-term liquidity, the analysts noted that the company’s limited capital is a constraining factor, which adds to the uncertainty of the drug’s path to market. InvestingPro subscribers can access 13 additional key insights about MIST’s financial health and market position.
The FDA’s CRL has led to significant disruptions in the anticipated progression of etripamil. Milestone Pharmaceuticals must now address the concerns highlighted by the regulatory body before moving forward with the resubmission of the NDA.
In summary, the downgrade of Milestone Pharmaceuticals’ stock rating to Hold by TD Cowen reflects the uncertainties and challenges the company faces in advancing etripamil through the regulatory process and into the market, given the current concerns on FDA functionality and the company’s financial constraints.
In other recent news, Milestone Pharmaceuticals has encountered a setback with its New Drug Application for CARDAMYST™ (etripamil) nasal spray after receiving a Complete Response Letter from the FDA. The letter cited issues related to Chemistry, Manufacturing, and Controls, specifically concerning nitrosamine impurities and the need for an inspection of a facility involved in the drug’s release testing. Milestone (WA:MMD) has expressed its commitment to resolving these issues and plans to request a Type A meeting with the FDA to discuss the path forward. Additionally, Milestone has amended its sales agreement with Jefferies LLC, increasing its common shares offering to $77.8 million, which may help support its operational strategies. The company has also scheduled its 2025 annual meeting of shareholders for June 10, 2025, with important deadlines for shareholder proposals. Meanwhile, H.C. Wainwright has maintained a Buy rating on Milestone Pharmaceuticals, citing confidence in the potential approval of CARDAMYST and its market opportunities. The firm highlighted that etripamil could become a first-in-class therapy for PSVT and potentially expand into a larger market for atrial fibrillation with rapid ventricular rate. Milestone is expected to receive $75 million in milestone payments upon FDA approval, with a commercial launch anticipated for mid-2025.
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