Setback for Cyberonics: Senate Raises Questions on FDA Approval

Houston Chronicle, WASHINGTON – Cyberonics shares dropped Friday after a Senate panel questioned the Food and Drug Administration’s approval of the Houston firm’s implantable device for treating severe depression.
    The Senate Finance Committee issued a report Thursday challenging the FDA’s decision last July to approve use of Cyberonics’ Vagus Nerve Stimulator for patients suffering chronic or “treatment-resistant” depression.
    “I am greatly concerned that the Food and Drug Administration standard for approval may not have been met here,” Committee Chairman Charles Grassley, R-Iowa, said on the Senate floor Thursday.
    Cyberonics Chief Executive Officer Robert “Skip” Cummins quickly fired back, saying the committee “issued a report without having interviewed world renowned experts” on treatment-resistant depression.
    FDA officials failed to respond to repeated questions about the report.
    In a 390-page report, the committee said a senior FDA official overruled “the comprehensive scientific evaluation of more than 20 FDA scientists, medical officers and management staff” and approved the nerve stimulator’s use for treating severe depression. Dr. Daniel Schultz, the FDA’s medical device chief, is the official referred to in the report.
    While noting that all implantable devices carry risks, the report said it was “questionable” that the Cyberonics device “met the agency’s standard for safety and effectiveness.”
    The committee report also accused the FDA of failing to provide the public all the information necessary to make informed decisions about the device’s use. Comments suggesting more data were needed to gauge the device’s effectiveness, for instance, were “absent from the summary that is posted on the FDA’s Web site.”
    Cyberonics shared fell $1.24, or about 4 percent, Friday to close at $28.70.
    These shares have been repeatedly jolted by the controversy over using the device to treat depression. Cyberonics’ stock dived in August 2004 after the FDA rejected its depression application despite an advisory panel’s recommendation to approve it.
    But its stock soared in February 2005 after the regulators reversed their position, and issued the company an “approvable” letter, meaning that it would likely be granted approval if the company met certain conditions.
    The size of a stopwatch, the nerve stimular is a pacemakerlike device that is implanted in a patient’s upper chest and sends electrical impulses to the vagus nerve in the neck.
    It has been used to treat epilepsy since 1997, and Cyberonics officials believe it could transform the lives of patients who have suffered from severe depression for years.
    Cummins pointed to patients who had not responded to an average of 20 different kinds of treatments over a quarter of a century. More than half realized a “meaningful clinical benefit, ” while 20 percent were depression symptom-free, he said.
    Ryan Rauch, Jefferies & Co.’s senior medical devices analyst, said Grassley’s criticisms should come as no surprise. “Clearly, anyone close to this story knows that Sen. Grassley has been opposed to Cyberonics’ depression device for almost a year now,” Rauch said.