Gilead's Rheumatoid Arthritis Drug Application Is A No-Go In Present Form: FDA

Gilead Sciences, Inc (NASDAQ: GILD) shares took a jolt in the after-hours session Tuesday as it announced its application for filgotinib, an investigational treatment for moderately to severely active rheumatoid arthritis (RA) didn't get the go-ahead from the United States Food and Drug Administration.What Happened: The biopharmaceutical company received a complete response letter (CRL) from the FDA that said the review cycle for an application is complete and that the application isn't ready for approval in its present form.Gilead is the market authorization holder for filgotinib in the U.S. as well as for the potential commercialization of the drug in the country, which it is developing in collaboration with Galapagos NV (NASDAQ: GLPG).Why It Matters: Gilead was one of the few pharma companies that bucked the trend to reach new highs, while most companies on the stock markets crashed when the pandemic spread to the world in March.The stock zoomed up to touch almost $84 in April as its new drug, remdesivir showed great potential to treat COVID-19 patients. However, the stock has now dipped below $70 levels for the first time since March as the company's Q2 results weren't very exciting.What's Next: The FDA has requested additional data from the MANTA and MANTA-RAy studies to complete the review of the new drug application. These studies will help assess the drug's impact on sperm parameters as the FDA has also expressed concerns over filgotinib's 200 mg dose."We are disappointed in this outcome and will evaluate the points raised in the CRL for discussion with the FDA. We continue to believe in the benefit/risk profile of filgotinib in RA, which has been demonstrated in the FINCH Phase 3 clinical program," said Gilead Chief Medical Officer Merdad Parsey.Gilead and Galapagos are collaborative partners in the development of filgotinib. The two companies have multiple clinical programs for the drug in inflammatory diseases. Gilead submitted the New Drug Application for filgotinib last December.Price Action: Gilead shares traded 3.4% lower at $66.69 in the after-hours session Tuesday. Galapagos shares closed about 2.4% lower at $188.08 in the regular session in New York.See more from Benzinga * Overstock Shares Up 1,600% This Year, As E-commerce Demand Surges During Pandemic * Uber Says Food Delivery Business To Continue In California, Unaffected By Court Ruling * Oracle Joins Microsoft In Race To Acquire TikTok's Business In Major Markets: FT(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.