Jersey City-based biotechnology company, Scynexis, experienced a significant decline in its shares, dropping over 30% on Monday. The setback was a result of a potential cross-contamination problem, which led the company to initiate a recall of its FDA-approved antifungal products and halt a late-stage study.
Scynexis had previously granted a license to UK drug giant GSK for its antifungal compound, ibrexafungerp, which included the approved product Brexafemme. However, during a review by GSK of the vendor responsible for manufacturing the ibrexafungerp drug substance, they discovered a risk of cross-contamination. This contamination could potentially cause hypersensitivity or allergic reactions in certain individuals.
As part of the licensing agreement, GSK made an upfront payment of $90 million to Scynexis. In the second quarter, Scynexis reported revenue of nearly $131 million associated with this deal.
Brexafemme, an FDA-approved treatment for vulvovaginal candidiasis (commonly known as vaginal yeast infection), is also utilized to reduce the recurrence of this condition. The compound is currently undergoing a Phase 3 study for invasive candidiasis.
To address the cross-contamination issue, Scynexis is implementing a recall and putting the study on hold. Their focus is on developing a mitigation strategy and establishing a resupply plan.