Aldeyra Therapeutics stock plunges on heavy volume after FDA finds ‘substantive’ issues with NDA for dry-eye disease treatment

Shares of Aldeyra Therapeutics Inc.
ALDX,
-66.11%
plummeted 61.9% toward a 3 1/2-year low in very active morning trading Monday, enough to pace the Nasdaq’s decliners, after the Massachusetts-based biotechnology company said the U.S. Food and Drug Administration identified “substantive review issues” with the new dug application (NDA) for its dry-eye disease treatment reproxalap. Trading volume ballooned to 12.3 million shares, compared with the full-day average of about 566,000 shares. In minutes from a late-cycle review meeting, the FDA stated, “[i]t does not appear that you have data to support the clinical relevance of the ocular signs to support your dry eye indication.” The company said it submitted responses to the FDA regarding the review issues, but the FDA said additional clinical trials were needed to satisfy efficacy requirements. Given that the NDA review cycle ends on Nov. 23, Aldeyra said the FDA may not be in position to approve the NDA. Aldeyra’s stock, which was headed for the lowest close since April 3, 2020, has plunged 73.6% over the past three months, while the iShares Biotechnology ETF
IBB,
+0.86%
has lost 5.2% and the S&P 500
SPX,
+1.07%
has eased 2.9%.