The federal government killed its contract to help Alpharetta-based Biota Pharmaceuticals develop a treatment to battle potential flu pandemics, the company reported Thursday.
The hit sent Biota’s stock price plummeting Thursday, following on steep drops last week after the government said it was temporarily halting the contract. Much of the company’s focus recently had been around its flu treatment.
The government provided “no reasons” for the termination, Biota said in a press release. Chief executive Russell Plumb said in the release that Biota is “somewhat perplexed” by the decision.
The U.S. government has spent $34 million to help Biota test laninamivir octanoate with hopes of winning approval to market the drug in this country. The contract allowed for government spending of up to about $231 million over five years.
A spokeswoman for the federal agency involved, the Biomedical Advanced Research and Development Authority, did not respond to a request for comment Thursday.
Last week, a BARDA official had said a review found “significant challenges” in the project that could cause delays and increase costs.
The official said the agency didn’t have safety worries about the drug. But he said concerns arose about the enrollment of subjects in clinical trials, the cost of additional trials, the emergence of resistance to the drug and the drug’s feasibility to treat some critically ill patients.
BARDA is building a system to develop and buy medicines and other material for public health emergencies. It supports more than 50 medicines, diagnostics and vaccines tied to influenza.
The same drug Biota was testing for U.S. approval has already been used by millions of people in Japan.
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