CARDAMYST's Regulatory Odyssey Nears Finish Line: Why Milestone Pharmaceuticals is Poised for Liftoff by Q4 2025

The biotech sector is notorious for its rollercoaster ride of regulatory hurdles, but Milestone Pharmaceuticals (NASDAQ: MIST) is now navigating its way toward a potential breakthrough. With its investigational therapy CARDAMYST™ (etripamil) nasal spray, the company has cleared a major regulatory hurdle, aligning its path to FDA approval by December 2025 with critical strategic moves. Let's dissect how this small-cap biotech is positioning itself to capitalize on a significant unmet medical need—and why investors should pay attention.

The Regulatory Pivot: From CRL to PDUFA

The FDA's December 13, 2025 Prescription Drug User Fee Act (PDUFA) date marks a pivotal milestone for CARDAMYST, following the agency's acceptance of Milestone's response to a Complete Response Letter (CRL) issued in March 2025. The CRL had raised two Chemistry, Manufacturing, and Controls (CMC) issues:

1. Nitrosamine Impurities: Milestone addressed this by submitting data from additional in-vitro studies to meet updated FDA guidance on these carcinogenic compounds.
2. Manufacturing Compliance: The company transferred testing responsibilities from a flagged facility to third-party vendors with clean FDA inspection records, resolving Good Manufacturing Practices (GMP) concerns.

Crucially, the FDA explicitly stated it had “no concerns regarding the clinical section of the NDA”, validating the therapy's safety and efficacy for paroxysmal supraventricular tachycardia (PSVT), a rapid heart condition affecting millions. A Type A meeting in June 2025 further clarified outstanding issues, reducing approval uncertainty.

Financial Stability: The $75M RTW Backstop and Strategic Cash Management

With a $56 million cash balance as of March 2025, Milestone's financial runway has been extended thanks to a $75 million royalty purchase agreement (RTW). The RTW funding, initially tied to an approval deadline of September 2025, was revised to December 31, 2025, mirroring the new PDUFA date. This not only alleviates liquidity risks but also ensures capital for a commercial launch, including salesforce buildup and marketing.

While Q1 2025 saw a $20.8 million net loss—driven by $5 million in R&D and $10.4 million in commercial prep spending—the company has paused non-essential expenditures since the CRL. This discipline, paired with the RTW extension, buys time without diluting shareholders.

The Therapeutic Gap: Why PSVT Needs CARDAMYST

PSVT affects 2–3 million Americans, yet current treatments are suboptimal. Patients often rely on IV-administered medications (e.g., adenosine) or invasive procedures, requiring emergency room visits. CARDAMYST's self-administered nasal spray is the first therapy allowing patients to treat PSVT episodes at home—a $1.2 billion market opportunity by 2030, per industry estimates.

Independent validation comes from a Managed Healthcare Executive survey, where 40% of managed care professionals ranked CARDAMYST as the new drug most likely to improve patient outcomes. This reflects both its clinical profile and the unmet need in PSVT management.

Risks on the Horizon: FDA Approval and Execution

While optimism is high, risks remain:
- FDA Approval: No guarantees, though the PDUFA extension suggests constructive dialogue.
- Commercial Execution: Building a sales force and securing payer coverage post-approval will test Milestone's operational muscle.
- Patent Landscape: The recently granted U.S. Patent (No. 12,257,224) extends exclusivity to 2042, but potential generic challenges or biosimilar threats could arise.

Valuation and the Buy Signal

At current levels, MIST trades at a $200 million market cap, far below the $750–1 billion valuation analysts project if CARDAMYST wins approval. A successful December 2025 PDUFA decision could trigger a short squeeze, especially given the stock's low float and heavy short interest.

For investors, the risk/reward calculus is compelling:
- Upside: Approval could send shares to $15–$20, based on discounted cash flow models.
- Downside: If rejected, the RTW funding and patent assets provide a safety net, potentially enabling a restart with revised data.

Final Analysis: A High-Conviction Buy Ahead of PDUFA

Milestone has systematically addressed FDA concerns, secured funding, and positioned CARDAMYST as a category-defining therapy in PSVT. With execution risks mitigated and a clear path to approval, the Q4 2025 catalyst offers a rare opportunity to buy the dip ahead of a potential paradigm shift in cardiovascular care.

Investors should accumulate shares now, with a $10–$12 price target as a conservative baseline. The FDA's clock is ticking—and so is the clock for PSVT patients waiting for a better solution.

Disclosure: This analysis is for informational purposes only. Consult a licensed financial advisor before making investment decisions.