Applied Therapeutics stock collapses as FDA rejects govorestat for galactosemia treatment

Shares of Applied Therapeutics, Inc. (Nasdaq: APLT) suffered a dramatic decline after the U.S. Food and Drug Administration (FDA) issued a Complete Response Letter (CRL) for the company’s New Drug Application (NDA) for govorestat. This investigational therapy, developed for the treatment of classic galactosemia, failed to secure approval in its current form, prompting after-hours trading to slash the stock value by 76%, dropping to $2.04 from its regular session close of $8.57.

The FDA’s CRL, an official rejection, indicated deficiencies in the clinical data provided. While specific issues remain undisclosed, the letter signifies the need for additional information or modifications before reconsideration. Applied Therapeutics has announced plans to meet with the FDA to discuss resubmission requirements or a possible appeal, reaffirming its commitment to advancing treatment for this rare metabolic disorder.

Shoshana Shendelman, CEO of Applied Therapeutics, stated that the company was disheartened by the decision but determined to address the FDA’s concerns. She emphasised the unmet medical needs in the galactosemia community, describing the disease as progressive and debilitating, with no current treatment options available.

Govorestat, a central nervous system-penetrant aldose reductase inhibitor, has shown promise in clinical trials. Data from the Phase 3 ACTION-Galactosemia Kids study demonstrated meaningful improvements in activities of daily living, cognition, and behaviour among paediatric patients aged 2–17. Additionally, trials confirmed sustained reductions in galactitol, a toxic metabolite, across both adult and paediatric populations. Results from over three years of studies, encompassing 185 patients, highlighted a favourable safety profile and were published in the Journal of Clinical Pharmacology.

While the rejection marks a significant setback, Applied Therapeutics has several regulatory advantages. Govorestat holds Orphan Drug and Pediatric Rare Disease designations from the FDA, as well as Orphan Medicinal Product Designation from the European Medicines Agency (EMA). These classifications acknowledge the drug’s potential to address high unmet medical needs in rare conditions.

The company is also developing govorestat for sorbitol dehydrogenase deficiency, a rare neuromuscular disorder. An NDA submission for this indication is planned for early 2025, unaffected by the galactosemia rejection.

Despite these efforts, investor sentiment has turned sharply negative. Analysts highlight the importance of regulatory clarity for Applied Therapeutics’ long-term prospects. With the potential appeal or resubmission process likely to extend timelines, the company faces mounting pressure to restore confidence in its lead candidate.

As Applied Therapeutics moves forward, the spotlight remains on its ability to address the FDA’s concerns and reintroduce govorestat as a viable treatment. For now, the dramatic drop in share value underscores the challenges of navigating regulatory hurdles in the competitive biopharmaceutical sector.