If the FDA grants clearance and no-one hears, did it really happen?
That might be the question of the day for Mela Sciences (NSDQ:MELA) and CEO Dr. Joseph Gulfo, as they try to comprehend a 15.4 percent share price plunge, despite a long-awaited approval granted by the federal watchdog agency just a few days ago.
MELA shares were trading at $4.82 as of about 2:10 p.m. today, down 10.2 percent on the day and more than 15 percent off their $5.56 close Nov. 2, the day news of the clearance broke – and a full 20.3 percent off of a Nov. 2 high-water mark of $6.05.
In what Mela Sciences is calling a “commercial development year,” the company plans to place 200 MelaFind systems in the U.S. and 75 in Germany, working with doctors and patients to integrate the device into everyday care. Yesterday Gulfo told MassDevice that the company plans to begin rolling out the device during the first quarter next year.
“Dermatologists want this system, so we don’t need to ‘sell’ it," he told us. "I don’t think we’ll be ‘selling,’ in the classic sense of selling, for at least a year and a half … Since this is a new technology, our challenge will be incorporating it into the doctor’s office."
Share price aside, it’s been a good season for the company, which also won CE Mark approval in the European Union for MelaFind in September.
The FDA green light marks an end to the years-long plight that made Mela Sciences a poster child for charges of unpredictability at the FDA, culminating in a Progressive Policy Institute report, “Is the FDA Strangling Innovation?”
In July 2009, Mela Sciences submitted a pre-market approval application for the MelaFind. The company had already signed a definitive agreement with the FDA in 2004 detailing the precise path to clearance and had launched the largest melanoma trial to date to support the application.
The system proved highly effective in trials. Mela anticipated FDA panel review in Q1 2010, but got an “unapprovable” letter instead. The negative vote “poisoned” public and medical opinion against the company, Gulfo later told MassDevice, and led to several lawsuits from shareholders after shares sank abruptly from $6.37 on Nov. 15, 2010, to $2.53 just two days later, a 60 percent slide.
NuVasive rallies after hitting another 52-week low
Shares of NuVasive (NSDQ:NUVA) are up nearly 8 percent today after posting a new 52-week low of $13.54 yesterday.
NUVA shares have been volatile for months, ever since news broke Sept. 20 of a more than $100 million jury award for Medtronic (NYSE:MDT) in a patent infringement lawsuit against NuVasive. That sent prices briefly as low as $17.87 before a slight rally brought them back. Another rally sent shares up even further in early October, but dismal third-quarter numbers drove them back down to a new low of $14.20.
Shares dipped even further yesterday, falling to the latest 52-week low of $13.54, before spiking to close at $14.04. The spinal implant maker’s stock was trading at $15.15 as of about 2:40 p.m. today.
Earlier this week, Medtronic made good on its promise to seek an injunction barring NuVasive from making or selling the spinal implant found to infringe its patents.