December 11, 2019 / 1:57 PM / in 6 months

UPDATE 2-Correvio Pharma to explore sale after FDA panel setback; shares hit record low

(Adds background, company response; Updates shares)

Dec 11 (Reuters) - Correvio Pharma Corp said on Wednesday it would explore options including a sale, a day after its heart drug failed to win the backing of a panel of experts advising the U.S. Food and Drug Administration.

The Canadian drugmaker’s U.S.- and Toronto-listed shares plunged as much as 69% to hit all-time lows.

Correvio said it has retained Piper Jaffray to assist in its review of the strategic alternatives and has set up a transaction committee within its board.

The company said it plans to rein in operating costs in North America without specifying whether the measures would involve job cuts.

The drugmaker, which had about 138 employees across Europe, U.S, and Canada at the end of 2018, declined to provide additional details when contacted by Reuters.

Citing serious side effects, the panel on Tuesday voted here 11-2 against the approval of the company's drug, Brinavess, used to correct atrial fibrillation, a condition that causes irregular rhythm in the upper heart chambers.

“We will immediately begin preparations for a potential strategic transaction while we await the U.S. Food and Drug Administration decision regarding Brinavess,” Chief Executive Officer Mark Corrigan said in a statement on Wednesday.

The company’s decision to evaluate alternatives was anticipated after the latest setback in its efforts to market Brinavess in the United States.

Correvio has been trying to get the U.S. approval since 2006, but the FDA declined approval over safety concerns and later put the U.S. studies on hold after the death of a patient. The hold still remains in place.

A final decision is expected by Dec. 24. While the FDA is not mandated to follow the panel’s recommendation, it generally does.

Correvio’s approved drugs, which include antibiotics Xydalba and Zevtera, brought in sales of $6.7 million in the latest reported quarter. (Reporting by Saumya Sibi Joseph in Bengaluru; Editing by Amy Caren Daniel)

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