By Shivani Singh

(Reuters) – Adamis Pharmaceuticals Corp <ADMP.O> said on Monday the U.S. Food and Drug Administration declined to approve its opioid overdose treatment, Zimhi, sending its shares plunging 56%.

In a so-called complete response letter (CRL), the FDA questioned the treatment’s chemistry, manufacturing and controls process, but not its safety or effectiveness, the company said.

The drug is a naloxone pre-filled single dose syringe used for emergency treatment of known or suspected opioid overdose, and investors hoped the treatment would help the San Diego-based company reduce its reliance on its emergency allergy shot, Symjepi.

Adamis Pharmaceuticals had revenue of about $5.9 million in the third quarter, a 54% jump from a year earlier on Symjepi demand.

Maxim Group analyst Jason McCarthy in a note, ahead of FDA’s decision, estimated Zimhi to bring in peak sales of $70.8 mln in 2028.

“We believe the comments and recommendations stated in the CRL are manageable and plan to fully cooperate with the FDA,” Adamis Chief Executive Dennis Carlo said in a statement.

The company said it will request a meeting with the FDA “as soon as reasonably possible” and plans to resubmit its application for approval.

Adamis is seeking to use Zimhi, which delivers high doses of naloxone, as part of the fight against the opioid crisis in the United States.

Opioids were involved in nearly 400,000 overdose deaths in the United States from 1999 to 2017, according to the U.S. Centers for Disease Control and Prevention.

The U.S. Department of Health and Human Services last December had recommended prescribing or co-prescribing naloxone to high-risk patients for opioid overdose.

The company’s shares were at 54 cents in morning trading. They had fallen 44% this year, through Friday’s close.

(Reporting by Shivani Singh and Manojna Maddipatla in Bengaluru; Editing by Shinjini Ganguli and Sriraj Kalluvila)