Shares of Outlook Therapeutics fell sharply on Thursday after the US Food and Drug Administration (FDA) rejected the company’s application for its experimental eye drug ONS-5010, a proposed treatment for wet age-related macular degeneration (wet AMD).
The decision dealt a significant setback to the New Jersey-based company’s efforts to enter the US market for vision therapies.
The stock collapsed by more than 52% in early trading, after having fallen as much as 71% in the premarket session.
If losses hold through the day, Outlook is on track for its steepest single-day decline in more than nine months.
FDA cites lack of efficacy data
Outlook disclosed that the FDA issued a complete response letter, saying that the company’s application did not provide substantial evidence of effectiveness.
The agency recommended the submission of confirmatory clinical data before it would reconsider approval.
This is the second time the regulator has declined to approve ONS-5010.
In August 2023, the FDA turned away the company’s original application, citing shortcomings in chemistry, manufacturing, and controls, as well as the need for stronger clinical evidence.
Outlook resubmitted its application in February 2025, and the FDA accepted it for review in April with a decision deadline of August 27.
Chief Executive Bob Jahr expressed disappointment but emphasized that the company intends to meet with the agency to gain clarity on the additional data required.
“While we are very disappointed with this outcome, we intend to work closely with the FDA to understand the next steps,” he said.
Ongoing challenges in drug approval
The FDA’s rejection follows a series of hurdles for Outlook.
The company withdrew its application in 2022 after the regulator requested further information, and its resubmitted filing failed to overcome concerns last year.
Clinical data has also raised questions. In its key trial comparing ONS-5010 to Roche’s Lucentis, the therapy did not demonstrate equivalent performance at the eight-week mark.
That places Outlook at a disadvantage against entrenched competitors such as Roche’s Lucentis and Vabysmo, as well as Regeneron’s Eylea, all of which are widely used in the US.
Financial strain and European progress
The setback comes as Outlook attempts to transition into a commercial-stage company.
ONS-5010, marketed in Europe under the brand name Lytenava, has already received approval from the European Commission and UK regulators.
It is available in Germany and the UK for wet AMD, which causes blurred or reduced central vision and is a leading cause of blindness in older adults.
Revenue of $1.5 million during the third quarter came primarily from early sales of Lytenava in Germany and the UK, marking the firm’s first commercial revenue.
Management highlighted this as an important milestone despite the regulatory challenges in the U.S.
The company otherwise reported a net loss attributable to stockholders of $20.2 million, or $0.55 per share, narrowing from a $0.89 per share loss a year earlier.
Adjusted net loss stood at $15.8 million, compared with $19.2 million in the prior-year period.
Outlook ahead
While the FDA’s latest rejection raises doubts about ONS-5010’s path forward in the U.S., the company is banking on international sales to sustain its strategy.
It plans to continue expanding across European markets while seeking clarity on the additional efficacy data needed to satisfy US regulators.
For investors, the latest developments underscore the risks facing smaller biotech firms seeking to compete in highly regulated, competitive markets.
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