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The stock price of biotech CTI BioPharma ( CTIC ) fell to pennies Wednesday after the company said late Tuesday that it had withdrawn its FDA application for pacritinib, a blood-cancer drug that it was developing in partnership with Baxalta ( BXLT ). CTI and Baxalta had filed for approval of pacritinib for myelofibrosis on Jan. 5, but clinical trials of the drug were still underway. On Monday, CTI said that the FDA had placed a partial clinical hold after it had seen “excess mortality and other adverse events in pacritinib-treated patients compared to the control arm” in one of the trials, according to a press release. On Tuesday, CTI said the FDA had placed a full clinical hold on the trials, inducing the companies to withdraw the application and “decide next steps.” The application covered a fairly narrow range of patients — specifically those with intermediate and high-risk myelofibrosis with low platelet counts of less than 50,000 per microliter. However, it did present some potential competition to Incyte ‘s ( INCY ) Jakafi, both in its target and in its class, as both drugs are Janus kinase (JAK) inhibitors. “While we didn’t view CTI/Baxalta’s pacritinib as a significant threat to Incyte’s Jakafi franchise in myelofibrosis, we think the unfortunate and surprising setback of a potential competitor should remove a small overhang on Incyte shares,” wrote Leerink analyst Michael Schmidt in a research note. Incyte stock was up 3% in early afternoon trading on the stock market today , near 74. CTI BioPharma, already beaten down by Monday’s news, was off 40% to 30 cents. Baxalta was up about 2%, perhaps because its future acquirer, Shire ( SHPG ), received an unrelated upgrade from RBC Capital Markets. Analyst Douglas Miehm lifted his rating to outperform from sector perform, writing that the competitive threat to Baxalta’s hemophilia portfolio has been more than accounted for in Shire’s 42% drop in share price since last August. Shire stock also was up about 2%, near 154, early Wednesday afternoon. Image provided by Shutterstock . Scalper1 News
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