An injection for "double chin" reduction developed by Kythera Biopharmaceuticals Inc cleared the first hurdle toward approval as U.S. Food and Drug Administration staff concluded the drug's benefits outweighed its risks.
Kythera's stock jumped as much as 25 percent as investors bet on what could be the first approved drug in the United States to reduce localized fat deposits.
The drug, ATX-101, is a formulation of deoxycholic acid, which destroys fat cells under the chin but leaves surrounding tissue largely unaffected.
Existing options are limited to surgeries performed under general anesthesia and liposuction.
No safety issues associated with long-term use of ATX-101 have been identified so far, FDA reviewers said on Thursday.
An independent panel of experts will meet on Monday to discuss the drug and recommend to the FDA whether it should be approved. The FDA typically accepts the panel's recommendations.
Leerink Partners analyst Seamus Fernandez said he expects the drug to be approved by May 13, when the FDA is scheduled to make its final decision.
Last year, Kythera regained rights to the market the drug outside the United States and Canada from a unit of Germany's Bayer AG.
The drug is also being reviewed by Canadian and Swiss regulators.