By Lisa Seachrist

Washington Editor

WASHINGTON -- Cephalon Inc.'s stock fell 20 percent following news Monday the FDA canceled an advisory panel meeting to evaluate the company's beleaguered Lou Gehrig's disease drug, Myotrophin.

Citing a need to continue its review of the drug, designed to treat amyotrophic lateral sclerosis (ALS), the agency canceled Thursday's meeting of the Peripheral and Central Nervous System Drugs Advisory Committee, which was to evaluate the data supporting Myotrophin for the third time. The agency has until May 11 to decide the drug's fate under the Prescription Drug User Fee Act and may now have to do so without the advice of the panel.

"We are continuing to work with agency," said Kori Beer, manager of corporate communications for West Chester, Pa.-based Cephalon. "We are hopeful that we will get approval for this drug."

The news that the advisory panel was canceled sent Cephalon's stock (NASDAQ:CEPH) down $3.1875 to close at $12.1875. Chiron Corp., of Emeryville, Calif., which co-developed Myotrophin, saw its stock go down by $0.6875 to close at $20.875.

In June 1996, the advisory panel approved the companies' request for a treatment investigational new drug (IND) application for Myotrophin (recombinant human insulin-like growth factor) for the treatment of ALS, a progressive and fatal neurodegenerative disease which destroys motor neurons -- nerve cells that control muscle activity. Several panel members recommended that Cephalon and Chiron use the treatment IND to perform an additional clinical trial to clear up apparently discordant clinical data. The companies did not follow the suggestion.

In May 1997 amid desperate pleas from patients, the FDA advisory panel refused to recommend Myotrophin for approval, citing conflicting trial results. A North American study showed the drug slowed the progression of ALS by 26 percent; however, a European study of the drug failed to show any benefit at all.

Bound by an August 11, 1997, deadline to make a decision on the drug, Cephalon and Chiron submitted supplemental information allowing the agency to postpone its decision for three months to Nov. 11, 1997. As that deadline approached, the FDA needed still more time to make its decision, so the companies withdrew and resubmitted their NDA, adding six more months to the clock.

Beer told BioWorld Today Friday Cephalon and Chiron had not been notified by FDA whether they would be asked to present data or simply to be on hand to answer questions.

Another Panel Meeting Not Set

With five weeks left for the FDA to make a decision on whether to approve the drug, it is unclear whether the agency will have enough time to call another panel meeting.

Some observers have suggested the companies could go for a "fast track" designation under the FDA Modernization Act.

"It is not altogether clear that this would be applicable in our case," Beer said. "We don't intend to file for fast-track status."

A fast-track designation means the FDA can take actions to expedite development and review of a drug intended to treat serious or life-threatening conditions that represent an unmet medical need. The agency can approve the drug if it has an effect on a clinical or surrogate endpoint. Confirmation of the drug's benefit can be obtained in post-marketing studies.

Currently the only drug approved for ALS is Collegeville, Pa.-based Rhone-Poulenc Rorer Inc.'s Rilutek, which has been shown to add on average three months of life forALS patients, whose life span after diagnosis averages three years. *