FDA Advisory thumbs down for Columbia and Watson product

US drugmakers Columbia Laboratories (Nasdaq: CBRX) and Watson Pharmaceuticals (NYSE: WPI) confirmed on Friday that the US Food and Drug Administration’s Advisory Committee for Reproductive Health Drugs did not recommend approval of their progesterone vaginal gel 8% for the reduction of risk of preterm birth in women with short uterine cervical length at the mid-trimester of pregnancy.

While panel members generally agreed that progesterone vaginal gel 8% is safe, the panel stated that more information is needed to support approval. The FDA will consider recommendations of the Committee, but the final decision regarding the approval of the product rests solely with the FDA. The FDA's Division of Reproductive and Urologic Products is expected to take action on Columbia's New Drug Application by February 26, 2012.

Watson and Columbia sell the gel as Crinone in the USA as part of an infertility treatment. Management had suggested peak sales in preterm birth prevention may reach as high as $275 million, according to Michael Tong, a senior analyst with Wells Fargo & Co quoted by Bloomberg. Columbia’s shares were suspended during the advisory committee hearings, but fell 30% to $1.60 a couple of days earlier in anticipation of hearings, while Watson’s stock declined 3.3% to$58.25.