UPDATE 3-Key Santhera drug misses late stage target

* Friedreich's Ataxia drug fails to meet main goal in study

* Will consider all options to preserve cash

* Believes European data could suffice for U.S. approval

* Shares down 30 percent

(Adds shares)

By Sam Cage and Paul Arnold

ZURICH, May 19 (Reuters) - Santhera Pharmaceuticals' (SANN.S) lead drug Catena missed its main aim in a late stage clinical trial in Friedreich's Ataxia and the biotech company will consider all options to preserve cash, it said on Tuesday.

Chief Executive Klaus Schollmeier told Reuters the failure did not necessarily preclude approval in the United States, provided results of a European study were positive, but it meant a delay of about 10 months. Santhera shares fell 30 percent.

"We have to go back and look at our business plan going forward and if necessary take the appropriate actions to preserve as much cash as we need," Schollmeier said in a phone interview.

Catena, also known as idebenone, is the Swiss company's first drug to reach the market after gaining approval in Canada. The medicine is partnered with Takeda Pharmaceutical (4502.T) in Europe, where it is called Sovrima.

It failed to show a statistically significant improvement in patients' neurological status over six months when compared with placebo, Santhera said.

"This is a huge blow for the company as the outcome of this trial was the basis for the expected filing of the product in the U.S.," WestLB analyst Simon Mather said.

"Moreover the company is now likely to run out of cash during 2010 with an estimated 60 million Swiss francs ($53.8 million) left," Mather said, adding the produce may be withdrawn in Canada since approval there was conditional on positive data from the U.S. trial.

Santhera shares fell 30.6 percent to 35.00 francs by 0740 GMT, compared with a 0.3 percent drop in the European health care sector .SXDP.

Friedreich's Ataxia is a rare genetic neuromuscular disease that causes the degeneration of an individual's nerve and muscle tissue and results in a loss of muscle control, uncoordinated movements, muscle wasting and thickening of heart walls. Santhera will not stop any clinical trials which can make a difference to the value of the company, but will consider all other options to preserve its cash position, he said.

But it expects that a continuing late stage study in Europe could provide the necessary data to support an application for approval in the United States and so does not plan a new trial, Schollmeier added. ($1=1.115 Swiss Francs) (Editing by Dan Lalor and Mike Nesbit)