Minnesota-based EnteroMedics (NSDQ:ETRM) faces a rough road at the FDA with newly published clinical trial results showing that its flagship Maestro VBLOC system failed to meet efficacy targets.
Results from the company’s ReCharge study, published this week in the Journal of the American Medical Assn., showed that the Maestro VBLOC neurostimulation implant helped patients achieve significant weight-loss when compared with a sham treatment, but the device fell short of expectations.
News of the miss sent ETRM shares down more than 7% today to trade at $1.35 as of about 2:15 p.m. EST, continuing a decline that has seen per-share value drop nearly 34% since the start of the year.
The ReCharge results represent an important slip, but the study did find clinical significant weight-loss among patients treated with the Maestro system. The double-blind, sham-controlled study found 8.5% greater weight loss among Maestro patients than the sham arm, a result that fell short of the 10% target.
Maestro also beat its safety target by a mile, with just 3.7% of patients suffering device, procedure, or therapy-related serious adverse event rate, far short of the 15% cap.
The clinical miss helps explain why an FDA panel in June issued a mixed vote on Maestro. The panel voted 4-5 against the efficacy of the system, but some members of the committee urged leeway for the device given the growing threat of obesity in the U.S.
"At face value the very easy answer is no, just because of the parameters that are set," said Dr. Eric Felner of the Emory School of Medicine in Atlanta. "However, with what I deal with and what I see, I see obese kids, I see their parents who are far from thin, and the bottom line is this is a tremendous amount of weight loss. In every other study in every other committee I’ve been on looking at weight loss, this far exceeds what the bottom line is and so it definitely meets effectiveness, it just doesn’t meet the criteria that’s set out by the FDA."
The panel ultimately voted that the benefits of the device outweight its risks.
The Maestro system uses mild electrical stimulation to activate the vagus nerve located between the stomach and the esophagus in order to help modify physiological cravings and help patients form better eating habits. The device has been on the European market since winning CE Mark approval in 2011, but the company has reported no revenue.