Phibro Animal Health ($PAHC) lost 12% of its market value on a single day in April, after the FDA announced its plans to withdraw its approval of the company’s pig antibiotic, Mecadox (carbadox). In response, the company vowed to complete new safety studies and submit them to the agency in a bid to keep the product on the market.
Phibro made good on that promise on July 11, announcing the results from several new studies as part of its request for a hearing with the agency, according to a press release from the company. The studies were designed to address concerns that residues of the drug might persist in the tissues of the pigs for longer than initially assumed, posing a cancer risk to people.
The company teamed up with scientists from Charles River Laboratories and the University of Edinburgh to conduct four years worth of studies, according to an executive summary of the research. They reported that no carcinogenic residues could be detected in meat tested with radioactive technology designed specifically to find such residues. The only residues present 42 days after the animals are taken off the drug, they reported, were from “a harmless, non-carcinogenic metabolite of carbadox.”
"The new studies leave no doubt about the safety of carbadox, and its benefits in preventing animal suffering and disease are well-documented,” said Larry Miller, Phibro’s chief operating officer, in the press release. “Therefore, we believe allowing it to remain a treatment option is the responsible course.” He added the company would work closely with the FDA to allay any concerns.
When the FDA first threatened to withdraw the antibiotic, it cited several studies to back up its claims of a cancer risk. But in its report, Phibro refutes the conclusions of some of those studies because of incomplete evidence that carbadox is unsafe, inappropriate study methodology and other factors.
Still, Phibro may be facing an uphill battle. Mecadox was banned in Canada in 2004 and in the European Union 5 years before that. And several public health organizations are siding with the FDA, including Pew Charitable Trusts and Food Animal Concerns Trust.
Investors seem unconvinced, too. Phibro’s stock, which is trading around $20.20, has lost half its value in the last year.