Regulatory Risk and Reward: Navigating FDA Delays in the ALS Therapeutics Landscape

The U.S. Food and Drug Administration (FDA) has long been a double-edged sword for biotech investors. While its rigorous standards ensure patient safety, delays in regulatory decisions can create short-term volatility and long-term uncertainty. Nowhere is this dynamic more pronounced than in the race to develop therapies for amyotrophic lateral sclerosis (ALS), a neurodegenerative disease with a $1.3 billion market projected by 2033. For investors, understanding how FDA delays shape both risk and opportunity is critical to navigating this high-stakes sector.

The Short-Term Volatility of Regulatory Delays

In 2025, the FDA's capacity challenges have become a recurring theme. Staffing reductions under the Trump administration—3,500 full-time employees lost—have left the agency struggling to meet deadlines. For small biotechs like Coya Therapeutics and KalVista Pharmaceuticals, these delays are more than bureaucratic hurdles; they are existential threats.

Take Coya Therapeutics, a Houston-based company developing a dual-component biologic for ALS. In July 2025, the FDA missed its review deadline for Coya's IND application, pushing the decision to August 29. This delay forced Coya to extend its cash runway, straining its $35.5 million in reserves. Similarly, KalVista's sebetralstat faced a PDUFA date miss in June 2025, creating a 30-day gap in investor confidence before eventual approval.

Such delays often trigger immediate market reactions. A missed PDUFA date can lead to sharp stock declines, as seen with KalVista, which dropped 12% in a single day when the FDA announced its delay. For small-cap biotechs, where liquidity is already tight, these swings can amplify financial instability.

The Long-Term Opportunity in Regulatory Resilience

Yet, for investors with a longer horizon, these delays also highlight opportunities. Companies that navigate the FDA's bottlenecks—by securing alternative funding, optimizing trial designs, or leveraging biomarkers—can emerge stronger.

Consider the case of NeuroSense Therapeutics, which recently finalized its phase 3 protocol for PrimeC, a combination therapy for ALS. Despite the broader regulatory climate, NeuroSense has maintained momentum by incorporating neurofilament light chain (NfL) as a biomarker, a strategy the FDA has endorsed for accelerated pathways. This approach not only streamlines trial design but also aligns with the agency's evolving priorities, reducing the risk of delays.

Moreover, the ALS market's projected growth—from $743.90 million in 2023 to $1.3 billion by 2033—creates a tailwind for companies that can secure approvals. Even a modest delay in 2025 may be offset by the long-term value of first-to-market therapies. For instance, Alchemab Therapeutics, in partnership with Eli Lilly, is advancing antibody-based ALS treatments. Its ability to maintain regulatory dialogue and adapt trial timelines could position it to capture a significant share of the market.

Strategic Investment Considerations

For investors, the key lies in balancing risk and reward. Here are three actionable strategies:

1. Prioritize Companies with Robust Clinical Designs
   Biotechs using biomarkers like NfL (as seen in tofersen's approval) or adaptive trial frameworks are better positioned to withstand regulatory scrutiny. These companies reduce the likelihood of costly phase 3 failures, a common pitfall in ALS development.

2. Monitor FDA Capacity Indicators
   The FDA's ability to restore staffing and efficiency will directly impact the sector. Investors should track metrics like PDUFA goal achievement rates and IND review timelines. A return to pre-2025 efficiency could catalyze a wave of approvals, boosting valuations.

3. Diversify Across the Development Pipeline
   While late-stage candidates like ANX005 (Annexon Biosciences) offer near-term visibility, early-stage innovators using AI-driven platforms (e.g., Verge Genomics) represent high-risk, high-reward opportunities. Diversification mitigates the impact of regulatory delays on any single asset.

Conclusion: Volatility as a Filter

The FDA's delays are not a death knell for biotech innovation but a filter that separates resilient companies from fragile ones. For investors, this period of regulatory uncertainty is an opportunity to identify undervalued assets with strong fundamentals. By focusing on companies that adapt to the new normal—leveraging biomarkers, optimizing trial designs, and securing alternative funding—investors can position themselves to capitalize on the ALS market's long-term potential while managing short-term volatility.

In the end, the biotech sector's ability to thrive in the face of regulatory headwinds may prove to be its greatest strength.