Savient Pharma gets Thumbs Up from FDA Panel

Savient (SVNT) got an overwhelming 14-1 approval from an FDA Panel today that reviewed their new gout drug named Krystexxa. This approval should alleviate most of the concern surrounding the feared side effects and allow for approval of the drug on 8/1/09. The stock was trading up some 25% in AH around $11.75.

• Savient Pharmaceuticals, Inc. (Nasdaq: SVNT - News) announced today that the Arthritis Advisory Committee appointed by the U.S. Food and Drug Administration (FDA) recommended by a vote of 14 to 1 that KRYSTEXXA(TM) (pegloticase), a biologic PEGylated uricase enzyme, be granted marketing approval by the FDA for the treatment of refractory chronic gout. Refractory chronic gout or treatment failure gout (TFG) is gout in patients who have failed to normalize serum uric acid and whose signs and symptoms are inadequately controlled with conventional urate-lowering therapy at the maximum medically appropriate dose or for whom conventional urate-lowering therapy is contraindicated. The current target Prescription Drug User Fee (PDUFA) action date for the FDA's decision as to whether to grant marketing approval for KRYSTEXXA is August 1, 2009.

The trading tomorrow will likely be dictated by analysts comments tomorrow pre-market and the Conference Call with management. Stone Fox would expect the stock to trade higher before the week ends as this stock had been under serious pressure since Sept last year when the stock was in the mid $20s and all the fears came to light over the approval of this drug. We'll likely hold shares unless it jumps dramatically above the AHs trades. A move to the $17-19 range might warrant a quick exit to book profits. Otherwise, the stock is drastically undervalued in the AH range and warrants holding onto the stock.