UPDATE 2-Coronado's bowel disease treatment fails mid-stage trial, shares sink
* Investors worry over success in other disorders - analyst
* Shares tank 70 pct to life-low
* Company to decide therapy's future after getting partner data (Adds analyst comments, background, updates share movement)
By Vrinda Manocha
Oct 14 (Reuters) - Coronado Biosciences Inc said its treatment for a type of inflammatory bowel disease failed a mid-stage study, sending its shares plunging 70 percent due to concerns that the therapy may not work for other disorders as well.
The treatment, Trichuris suis ova (TSO), failed the main goal of improving patients' s response to Crohn's disease, a type of inflammatory bowel disease.
TSO is also being tested in mid-stage studies to treat disorders including ulcerative colitis, multiple sclerosis and autism.
Analysts said the results dampened investors' optimism for the success of the treatment in the other trials.
"People thought that if it was going to have a good shot at success, Crohn's disease was where it was going to see good results," MLV & Co analyst Graig Suvannavejh told Reuters.
Roth Capital analyst Joseph Pantginis said there was no chance of the treatment succeeding in Crohn's disease. He also lowered his projected chances of TSO as a treatment for ulcerative colitis and multiple sclerosis.
"We believe Coronado is unfortunately entering a state of limbo as investors await what the next steps will be with this significant blow to confidence in the TSO program," he wrote in a note to clients.
He cut his rating on the stock to "neutral" from "buy" and slashed his price target to $2 from $24.
On a conference call with analysts, Coronado Chief Executive Harlan Weisman said there was a negative overall trial but TSO had activity in sicker patients.
MLV & Co analyst Suvannavejh said the company had not provided enough data from very sick patients to indicate if the treatment had potential to treat severe Crohn's disease.
Coronado said it would decide on the future of TSO as a treatment for Crohn's after analyzing data from the trial, along with data from a study by its partner, Dr. Falk Pharma Gmbh.
Data from Dr. Falk Pharma's mid-stage study is expected in the fourth quarter, Coronado said.
Suvannavejh said it was unclear how useful data from the partner's study would be as the trial did not include patients with more severe Crohn's disease.
TSO, made from eggs of the whipworm parasite found in pigs, helps modulate a patient's immune system and prevent it from attacking the body's own tissues and organs.
Coronado said the response rate of patients with moderate-to-severe Crohn's disease taking the treatment in the mid-stage trial was not different from patients taking the placebo.
The company said the treatment was safe and well-tolerated. Adverse events including abdominal pain were balanced between patients taking the treatment and those in the placebo group.
Shares of the company fell to a life-time low of $1.73 in early trading, before recouping some of the losses to be down at $1.93 at 12:25 p.m. ET. Nearly 18 million shares changed hands, over 30 times their 10-day average. (Reporting By Vrinda Manocha in Bangalore; Editing by Maju Samuel and Sriraj Kalluvila)
- Housing, jobs data weaken, but overall economic picture still upbeat
- Putin critic Khodorkovsky in Germany after pardon |
- Target probe eyes overseas hackers; stolen cards for sale online
- Pizza outlet attacked as India, U.S. fail to cool diplomat row |
- New York Mayor-elect's reputation for lateness parodied on Twitter