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ARS Pharmaceuticals' EpiPen Alternative Delayed US Approval – Two Analysts Offer Differing Views

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ARS Pharmaceuticals' EpiPen Alternative Delayed US Approval – Two Analysts Offer Differing Views

The US Food and Drug Administration (FDA) has issued a Complete Response Letter (CRL) regarding the New Drug Application (NDA) for neffy, ARS Pharmaceuticals Inc’s epinephrine nasal spray used to treat allergic reactions, including anaphylaxis. The CRL delays the approval process for neffy in the United States.

Two prominent analysts, Wedbush and William Blair, offer differing views on the implications of this FDA decision.

Wedbush Remains Optimistic

Wedbush analysts maintain their positive outlook on ARS Pharmaceuticals and continue to rate the stock as Outperform. However, they have revised the price target from $15 to $5.

The analysts are perplexed by the FDA’s decision to go against the favorable recommendation from the Pulmonary-Allergy Drug Advisory Committee. The FDA cited an undisclosed deficiency in the application, resulting in the issuance of the CRL. Wedbush still believes that neffy has a favorable benefit-risk profile and expects the drug to gain approval in the second half of 2024, pending the completion of a repeat dose PK/PD study under specific conditions.

ARS Pharmaceuticals had initially believed that the repeat-dose NAC study would be required after the drug’s launch, not before the approval.

Patient screening for the study is already underway, with the first dose scheduled to be administered soon. The final patient is expected to receive the dose by the end of 2023. Wedbush considers the clinical risk associated with this trial to be minimal due to the well-established safety profile of epinephrine.

William Blair Downgrades Stock

On the other hand, William Blair has downgraded ARS Pharmaceuticals to a Market Perform rating. They believe that the CRL will delay the timelines and increase the risks associated with conducting an additional head-to-head study.

Assessing the clinical and regulatory risks in the current situation is complex, according to the analysts. They await further clarity on the path forward and the availability of additional clinical data. However, William Blair acknowledges that neffy is a unique product and that ARS Pharmaceuticals has the potential to become a significant player in the self-administered epinephrine device market.

Price Movement

As of the latest update on Thursday, SPRY shares have risen by 26.7% to $3.70.