Shares of Celgene (CELG) are weak in early trading after an analyst at Morgan Stanley said in a note to investors that his analysis of prior ozanimod pre-clinical studies suggests it is increasingly likely the company will see a delay of up to 3 years in refiling an application for the drug. UP TO 3 YEAR DELAY SEEN: In a note to investors published prior to the open, Morgan Stanley analyst Matthew Harrison said Receptos, which has been acquired by Celgene, had previously published ozanimod preclinical toxicology results and studies of known metabolites in 2013 and 2014 and that he was able to locate copies of these presentations over the weekend. Based on his analysis of that data, Harrison believes the company will likely need to rerun preclinical toxicology, which could take 6 months to 2 years. Given that view, he thinks the delay for an ozanimod refiling with the FDA is “at a minimum 1 year and up to 3 years” if all animal work must be redone. Ozanimod is an investigational immunomodulatory drug currently in phase 3 clinical trials for the therapy of relapsing multiple sclerosis and ulcerative colitis. Previously, on February 27, 2018, Celgene had announced that it has received a Refusal to File letter from the FDA regarding its New Drug Application for ozanimod in development for the treatment of patients with relapsing forms of multiple sclerosis as the FDA determined that the nonclinical and clinical pharmacology sections in the NDA were insufficient to permit a complete review. Harrison has an Equal Weight rating and $93 price target on Celgene. PRICE ACTION: In early trading, Celgene has fallen $3.52, or nearly 4%, to $87.66 per share.
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