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PRASAD'S EXIT A WIN FOR BIOTECHS, BUT DON'T CELEBRATE YET
FDA vaccines chief Vinay Prasad is set to leave the agency next month, concluding a controversial tenure that stood in marked contrast to the more flexible regulatory approach to rare and serious diseases seen under his predecessor, Peter Marks.
The end of Prasad's tenure is likely to bring some relief to biotech companies, but Wall Street analysts caution that it's too soon to assume the FDA will quickly return to faster approvals or lower evidentiary bars.
"Prasad's departure is likely a tailwind for the biotech sector, particularly in cases of regulatory flexibility for companies developing novel therapies for rare diseases, but we would caution against celebrating before a replacement is disclosed," said William Blair analyst Matt Phipps.
U.S.-listed shares of uniQure QURE.O, with which the agency had a public feud, are up 21%, while those of Regenxbio RGNX.O are up nearly 23%. The FDA had declined to approve its gene therapy for a rare disease last month.
Prasad had been recognized as the most influential voice of skepticism against various aspects of drug development, including surrogate endpoints and external control arms, both of which are relied upon for rare disease approvals.
Prasad's departure could also result in greater scrutiny of FDA Commissioner Marty Makary's leadership, potentially impacting his tenure at the agency as well, at least two analysts said.
Many of the challenges facing the FDA, including questions around leadership stability, internal alignment, and consistent application of regulatory frameworks, extend well beyond any single individual, said Truist analyst Danielle Brill.
The FDA has not yet announced who will replace Prasad, but analysts question whether additional leadership changes will also follow.
Reassignments and departures of other Trump administration officials in recent days could point towards a greater effort from the administration to "clean house" ahead of midterms, said Brian Abrahams, analyst at RBC Capital Markets.
(Sriparna Roy & Sneha S K)
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EARLIER ON LIVE MARKETS:
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WALL STREET SINKS AS OIL SOARS CLICK HERE
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MS SEES PAIN NOW, GAINS LATER CLICK HERE
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BETTER FILL THE CAR UP, LIKE RIGHT NOW CLICK HERE
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