(Updates with close of trading in sixth paragraph.)
July 31 (Bloomberg) -- EDAP TMS SA, the maker of an ultrasound device to treat prostate cancer with lower rates of erectile dysfunction, lost almost half its market value after the product failed to win a U.S. advisory panel’s backing.
EDAP didn’t provide evidence the device is safe and effective, advisers to the Food and Drug Administration voted yesterday. The device, called Ablatherm, is an alternative to traditional surgical and radiation treatments. It uses a robotic arm to insert a high-intensity, focused ultrasound device that kills cancer cells.
While the company, based in Vaulx-en-Velin, France, said Ablatherm produces lower rates of side effects than traditional treatments, an FDA staff report released July 28 questioned whether EDAP’s methods for testing are adequate.
“I’m somewhat troubled by the statistical data,” said Peter Lewin, a panel member and biomedical engineering professor at Drexel University. “My reading of the tea leaves was that it was inconclusive and inadequate.
‘‘A wonderful technology that is coming out is getting a bad rap because of badly designed statistics,’’ he added.
EDAP’s American depositary receipts fell 44 percent to $1.92 at the close in New York, the largest drop since they began trading in 1997, according to data compiled by Bloomberg. Each receipt equals one regular share.
The French manufacturer compared patients in two different studies to gather evidence, rather than conduct a head-to-head trial, according to FDA staff report. The agency isn’t bound by the panel’s recommendation in deciding whether to make the device available for patients in the U.S.
‘‘We look forward to subsequent discussion with the FDA,” EDAP Chief Executive Officer Marc Oczachowski said in a statement. “We will continue to work diligently with the FDA as it carefully completes its final review.”
The majority of men who get surgery or radiation for prostate cancer suffer from immediate or delayed erectile dysfunction. Of patients who used Ablatherm, 30 percent to 40 percent had erection problems, less than traditional treatments, Oczachowski said in a telephone interview.
Prostate cancer is the second-most common cause of male cancer-related death in the U.S., according to the FDA. About 233,000 men will be diagnosed with prostate cancer this year and 29,480 will die, according to the National Cancer Institute.
About 35 percent of prostate cancer patients undergo surgery, 45 percent receive radiation and the rest watch and wait, EDAP said in an investor presentation.
EDAP submitted evidence to the FDA that relied on a registry of patients in Europe who have used the device during its 14 years on the market, and compared their data with a subgroup of patients in a U.S. Department of Veterans Affairs trial who underwent surgery called radical prostatectomy.
FDA staff also expressed concern that the company’s main goal was to measure how long patients lived without their disease spreading instead of the “gold standard” measurement of survival.
Panel members were concerned that 28 percent of patients who used the device had a biopsy showing cancer cells two years later. The company said the rate is typical of procedures that surgically remove tissue to treat prostate cancer and it isn’t always indicative of cancer spreading in the future.
Ablatherm is a probe connected to a robotic arm that is inserted through the rectum. A urologist watches an ultrasound of the patient’s prostate, and the probe heats the tissue and kills cancer cells. The device can be used as an outpatient procedure, and it would be the first such product in the U.S. approved for the treatment of prostate cancer, Oczachowski said.
There are minimally invasive surgical techniques that make small incisions and use long instruments to remove the prostate, including Intuitive Surgical Inc.’s da Vinci robotic system, according to the American Cancer Society. Patients recover sexual function faster when doctors use the da Vinci robot versus traditional surgery, according to Intuitive.
Ablatherm has been used on 40,000 patients worldwide, Oczachowski said. EDAP generated 24.1 million euros ($32 million) in 2013 sales, the company reported.