Aeterna Zentaris (AEZS) fell as much as 50% today on the fact that it had received a CRL from the FDA for Macrilen, which is an oral tablet used as a test to determine Adult Growth Hormone Deficiency. A CRL is a complete response letter from the FDA which pretty much indicates that the FDA has rejected the drug test because of many problems with the application. 

For starters, the data submitted to the FDA did not adequately show whether or not the AGHD test worked on patients that had taken it. To make matters worse, the NDA was said to lack complete and verifiable source data for determining whether patients were accurately diagnosed with AGHD to begin with. In light of these findings the company now has to move back to running a new big confirmatory trial that meets the FDA's standards. In addition to that study the company will also have to run another separate trial because of problems arising from an electrocardiogram QT interval which occurred. A QT interval is a measure of the heart rate of the patient in an electrocardiogram. Therefore the FDA has requested a study to determine that Macrilen was not responsible for the lengthened QT interval in the heart rates observed. 

We think that investors currently in AEZS should continue to hold as the company may be able to rekindle interest with positive data from the company's cancer compound currently in a phase 3 clinical trial. That cancer compound  is known as Zoptarelin Doxorubican and is being tested in patients with endometrial cancer. Endometrial cancer is a type of cancer that begins in the lining of the uterus. Aeterna Zentaris is on track to release interim data from this phase 3 trial in the middle of 2015 so current investors may have an opportunity to recoup losses if the results are positive. There is also a possibility that the stock can be bought now to trade up to the phase 3 data or hold all the way through the phase 3 endometrial cancer data. Investors and traders alike should note, though, that this still carries a lot of risk; therefore they should only invest what they can afford to lose.