Orphazyme shares tumbled more than 60% in pre-market trading

Orphazyme shares tumbled more than 60% in pre-market trading.

Orphazyme slashed its financial forecasts on Friday after U.S. health regulators rejected its key drug candidate.

Orphazyme said its application for FDA approval of arimoclomol, a treatment for genetic disorder Niemann-Pick disease type C, had not been successful.

As a result, it predicted revenue for the year would be lower than previously expected and its operating loss significantly wider, forcing the company to cut costs.

"Orphazyme has no money and no substantial projects ... Investors have put their money into a completely unrealistic scenario driven by 'meme tendencies'," broker Nordnet wrote in a note to clients.

Orphazyme, which is listed in Copenhagen and New York, now expects an operating loss of 670-700 million crowns ($107-$112 million) in 2021, against a previous forecast for a loss of 100-150 million crowns.