BioMimetic bounces

After nosedive late yesterday, company responds to FDA and sees shares rocket forward

Email | Print By Walker Duncan

Franklin biotech firm BioMimetic Therapeutics has begun to rebound after plummeting 56 percent late yesterday afternoon.

Shares dropped sharply on the heels of an FDA communication concerning an increased cancer risk in patients using Johnson & Johnson product Regranex. The problem is that Regranex incorporates a recombinant human Platelet-Derived Growth Factor (rhPDGF-BB)(becaplermin), which is also a main component of BioMimetic’s own product.

Last night however, BioMimetic fired back, issuing a statement both questioning the FDA’S conclusions and distancing itself from the issue. The statement makes clear that the FDA communication concerns Regranex and that BioMimetic has received no communications from the FDA concerning its own products.

The company (Ticker: BMTI) also pointed to what it calls inconsistencies in the results. One example cited indicated "one analysis indicated no elevation in risk of cancer while another analysis suggested that among those who were prescribed Regranex three or more times, there was an increase in the number of patients who died as a result of cancer."

Later, the company explicitly stated that it "does not believe that an increased risk for cancer or cancer deaths has been demonstrated for the chronic administration of becaplermin up to multiple months, much less for a single application of becaplermin as is done with the product candidates from BioMimetic Therapeutics."

Many in the market have responded by picking back up the BMTI shares they dropped like hot potatoes yesterday, sending them up more than 40 percent. At 10 a.m. CDT, the stock was trading at $9.17 on volume roughly 13 times above average. That does, however, still leave it well below its previous 2008 low of $12.10.