Apellis eye drug rejected again in Europe

European drug regulators have rejected a groundbreaking eye medication from Apellis Pharmaceuticals, despite several efforts by the company to have the drug's benefits reconsidered. On Friday, Apellis announced that a committee advising the European Medicines Agency (EMA) has upheld a previous recommendation from June to reject their application for pegcetacoplan. This drug, known as Syfovre in the U.S., is used to treat geographic atrophy (GA), a progressive form of vision loss. The decision effectively blocks Syfovre from entering the European market, where an estimated 2.5 million people suffer from GA.

"We are deeply disappointed by this outcome, which leaves millions of Europeans with GA without a treatment for this irreversible form of blindness," said Apellis CEO Cedric Francois in a statement. The recommendation comes despite significant support for pegcetacoplan from the European retina community and several dissenting votes from the panel members who were in favor of approval.

This decision concludes a long-standing regulatory conflict between Apellis and the Committee for Medicinal Products for Human Use (CHMP) regarding Syfovre. In 2023, Syfovre became the first drug marketed specifically for GA, a common and gradually worsening type of vision loss. In February 2023, U.S. regulators approved Syfovre based on its capacity to slow the progression of the lesions that develop in the eyes of GA patients. These lesions, if left unchecked, can expand and impair vision, making the approval a significant milestone for Apellis.

However, Syfovre's market entry was marred by questions around its safety and efficacy. Although Apellis has attributed rare but serious side effects to faulty needles rather than the drug itself, the U.S. Food and Drug Administration (FDA) nonetheless added a warning to Syfovre's prescribing information last year. Adding to the competition, Astellas Pharma acquired Izervay, another treatment for GA, which received FDA approval in August 2023.

In Europe, Apellis faced greater challenges in convincing regulators. The CHMP issued a negative opinion in January, arguing that Syfovre did not provide clinically meaningful benefits during clinical trials and that regular injections posed a substantial risk of adverse events. Apellis appealed this decision, bringing in new panelists to reassess the evidence, but received the same negative outcome in June. On its third and final attempt, the company was once again unsuccessful, as confirmed by Apellis, though the official summary of the committee's findings has yet to be released.

Mizuho Securities analyst Graig Suvannavejh noted that the result was not surprising, given the low success rate of previous re-examination requests. Decisions on Syfovre are still pending in the U.K., Switzerland, Canada, and Australia. In response to the European regulatory setbacks, Apellis plans to restructure its European operations and lay off about 40 employees. The company had already reduced its workforce by 25% in 2023 to allocate more resources towards Syfovre's launch.

Apellis did not immediately respond to requests for comments on the restructuring. Suvannavejh had previously estimated that Syfovre could generate approximately $367 million in peak annual sales in Europe. Meanwhile, a review of Izervay is still underway.

Following the announcement, Apellis shares dropped by up to 10%, falling to just under $33 each in early trading on Friday.