Drugmaker ArQule Inc said it would lower the dose of its experimental liver cancer drug for a second time, after a late-stage trial showed that patients on the therapy were becoming more susceptible to infection.
The company's shares fell as much as 20 percent as the setback comes after the drug, tivantinib, failed separate trials for lung and colorectal cancers.
Analysts were concerned about whether the latest cut in dose would affect the drug's efficacy.
ArQule and its Japanese partner Daiichi Sankyo Inc accepted the recommendation of an independent safety committee to reduce, from 240 mg twice daily to 120 mg, the dose to treat hepatocellular carcinoma - the most common form of liver cancer.
Last year, ArQule reduced the liver cancer drug dose to 240 mg from 360 mg during a mid-stage trial due to high incidence of anemia and neutropenia - a condition characterized by an abnormally low number of infection-fighting white blood cells.
"The key question is how effective the 120 mg dose will be in treating hepatocellular carcinoma," MLV & Co analyst George Zavoico told Reuters.
Zavoico said the company might have to stop the trial if the neutropenia incidence remains greater than expected, but added that this was unlikely to happen at the 120 mg dose.
"This is no doubt a string of bad luck, but whether or not it suggests that the drug will ultimately fail is premature," Zavoico said.
ArQule and Daiichi Sankyo stopped a late-stage trial of tivantinib to treat lung cancer last October, after determining that the drug did not improve patient survival.
Kyowa Hakko Kirin Co, which holds development rights for the drug in Japan and certain parts of Asia, halted its own lung cancer trial soon after, following a safety committee's recommendation.
About two months later, the drug failed a mid-stage trial on patients with colorectal cancer.
ArQule and Daiichi Sankyo said on Tuesday that they were unable to comment on whether the timeline for recruitment of the liver cancer trial would be delayed, as the study was in the early stages of recruitment.
ArQule shares were down 7.5 percent at $2.58 on the Nasdaq on Tuesday.
(Reporting by Esha Dey and Vrinda Manocha in Bangalore; Editing by Kirti Pandey)