Why Bio Haven shares fell nearly 20% on Thursday

Volatile Biotech Stocks Biohazard (NYSE:BHVN) Easy to move up and down. It had one of the days of decline on Thursday, with its share price eroding nearly 20% in the top regulator's developments. That's a day when stocks usually perform well, like S&P 500 (snpindex: ^gspc) Landed on positive territory, up 0.4%.

After the market closed Wednesday, Biohaven leaked that the U.S. Food and Drug Administration (FDA) Neurology Division 1 is extending its deadline for its decision to develop a very promising pipeline drug that the company has developed.

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Specifically, the FDA unit extended the date of Biohaven's Troriluzole's Prescription Drug User Fee Act (PDUFA), a treatment targeting the brain disease polio (SCA), for three months. The biotech has formally submitted Troriluzole under the FDA's New Drug Application (NDA) regime, and the regulator's decision is now expected to appear in the fourth calendar quarter of the year.

According to the company, the FDA said it would take extra time to conduct a comprehensive review of the recent biohack submissions of regulatory information requests. The FDA department also told the company it aims to hold an advisory committee meeting to discuss the Troriluzole application, but has not yet set a date.

Many investors believe that Biohaven has great potential for Troriluzole because it targets rare brain diseases that are not currently treated. The FDA has granted it a fast track, priority review and orphan drug names (ODDs), so it seems that the approval decision will soon appear initially.

It's always disappointing when there is a delay, but it's hard to measure the ultimate future of Troriluzole until we learn more about regulators' concerns. It depends largely on the FDA's actions in the coming months.

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