The stock of Columbia Laboratories Inc. fell the most in almost five years after U.S. regulators said the company's progesterone gel to reduce the risk of preterm birth isn't effective.
Columbia Labs shares dropped 54 percent to close at $1.10, the biggest single-day decline since Feb. 5, 2007. Watson Pharmaceuticals Inc., a partner on the drug, fell 6.8 percent to $57.98, the greatest single-day loss in almost three years.
"The information and data in this application do not support the efficacy of progesterone gel compared with placebo in reducing the risk of preterm births before 33 completed weeks," Food and Drug Administration staff wrote in a Dec. 22 report released Tuesday.
The product would compete with KV Pharmaceutical Co.'s gel Makena, approved in February 2010. Class A shares of the Bridgeton-based drugmaker rose 6.2 percent to $1.89.
The FDA staff based its determination on data from narrow groups in a global study, said Amy Raskopf, a spokeswoman for Columbia Labs.
"This is a global study," she said. "It was designed as a global study. FDA agreed."
An FDA advisory panel is set to meet Friday on Columbia Labs' gel and weigh the risks and benefits. The agency isn't required to follow the panel recommendations.
Of U.S. patients, 16.8 percent using the gel experienced preterm birth at 33 weeks of pregnancy, the endpoint the company and the agency agreed on, compared with 19.2 percent using placebo, not a statistically significant difference, FDA staff said.