Ascelia Pharma shares collapsed by 71% in Stockholm trading after the US Food and Drug Administration (FDA) rejected the company's lead product candidate, Orviglance.
The regulatory setback represents a significant blow to the Swedish biotech firm, which had pinned substantial value on the approval of its diagnostic technology.
The steep sell-off reflects the market's reassessment of the company's near-term revenue prospects.
With the primary catalyst for growth now stalled, investors are pricing in the extended timeline and additional capital requirements likely needed to address the FDA's concerns or pivot to alternative candidates.
This development underscores the persistent volatility in the small-cap biotech sector, where single-asset dependency can lead to dramatic valuation swings.
The rejection adds to a broader narrative of regulatory scrutiny impacting European life sciences firms seeking US market access.