Neuren's Rett Syndrome Therapy Wins Critical European Backing after Shock Reversal, $35 Million Milestone Now in Sight

Neuren Pharmaceuticals' partner Acadia has secured a positive recommendation from the European Medicines Agency's CHMP for Daybu (trofinetide), reversing an earlier negative opinion. The Silicon Review examines how a dramatic regulatory U-turn could unlock $35 million for the Australian biotech and transform care for thousands of families.

In a stunning reversal that sent shockwaves through the biotech sector, the European Medicines Agency's Committee for Medicinal Products for Human Use has recommended approval of Neuren Pharmaceuticals' Rett syndrome therapy Daybu, overturning its previous negative stance from February 2026.

The decision is a watershed moment for the estimated 9,000 to 12,000 Rett patients across Europe who currently has no approved treatment options for the rare neurodevelopmental disorder that affects approximately one in 10,000 to 15,000 female births.

Neuren's shares surged more than 30 per cent on the news as investors celebrated the regulatory turnaround. The company, which licenses trofinetide to US-based Acadia Pharmaceuticals, is now in line for a US$35 million payment on first commercial sales in Europe, plus up to US$170 million in sales milestones and tiered royalties ranging from mid-teens to low-20 per cent .

The European Commission is expected to issue a final decision in the coming months, with approval covering all 27 EU member states plus Iceland, Liechtenstein, and Norway. The therapy would be indicated for patients aged five years and older, compared to the US approval for those aged two and above.

"I am so delighted for all stakeholders to see this positive outcome. With no approved treatment currently available in the EU, approval of DAYBU would be an important step forward for patients, caregivers, and the wider Rett syndrome community," said Neuren CEO Jon Pilcher.

The CHMP's initial refusal in February was based on what the EMA described as the "small effect size" of the drug after 12 weeks, concerns over high patient withdrawals from the study, and questions about the representativeness of the trial population. Acadia requested a re-examination a process with only a 20-30 per cent success rate.

The positive recommendation now paves the way for what would be Europe's first approved therapy for Rett syndrome, a condition characterised by developmental regression between 6 and 18 months of age, leading to loss of speech, mobility impairment, and severe intellectual disability .

Broker Canaccord expects Neuren to receive the US$35 million milestone payment in the December quarter of 2027, with peak non-US sales (mainly from Europe) estimated at US$250 million. However, European reimbursement is expected to be more challenging than in the US, where Acadia charges approximately US$375,000 per patient annually.

Here is the question this regulatory reversal raises. The EMA's expert committee was so unconvinced by the data that it issued a formal negative opinion in February, only to completely reverse its stance three months later. When the same evidence can produce two such different outcomes, is the European drug approval system flexible and responsive or deeply unpredictable?

Trofinetide is already approved in the United States (under the name Daybue) and Canada, marking the first and only therapy available for Rett syndrome. The drug is a synthetic analogue of a molecule derived from IGF-1, believed to help improve brain cell structure and communication.

As Neuren's partner secures critical European backing for its Rett syndrome therapy, The Silicon Review asks a final question. When a drug rejected by regulators in February becomes recommended in June, do patients and investors celebrate the outcome or question the process?

FAQ:

Q: What is Neuren's Rett syndrome therapy called in Europe?
A: The drug is marketed as Daybu (trofinetide) in Europe, compared to Daybue in the United States.

Q: What did the European Medicines Agency recommend for Neuren's drug?
A: The CHMP reversed its previous negative stance and recommended marketing authorisation for Daybu (trofinetide) for Rett syndrome patients aged five years and older.

Q: How much will Neuren receive if the drug is approved in Europe?
A: Neuren is entitled to US$35 million on first commercial sales, up to US$170 million in sales milestones, and tiered royalties of mid-teens to low-20 per cent .

Q: How many Rett patients are there in Europe?
A: Acadia estimates approximately 9,000 to 12,000 Rett syndrome patients across Europe.

Q: Why did the EMA initially reject the drug in February 2026?
A: The CHMP initially concluded that the drug's effect size was too small to be clinically meaningful, and had concerns over patient withdrawals and the representativeness of the study population.