Cytokinetics shares plunge as neuro drug fails trial
(Reuters) - Cytokinetics Inc (CYTK.O) said its experimental treatment for Lou Gehrig's disease - a progressive neurodegenerative disorder - failed a mid-stage trial, sending its shares plummeting about 60 percent.
The study tested the efficacy of the drug, tirasemtiv - one of the company's lead compounds - against a placebo in 711 patients with amyotrophic lateral sclerosis (ALS), commonly called Lou Gehrig's disease.
Despite the market's overwhelmingly negative reaction, analysts said all was not lost.
Investor focus would now shift to the company's experimental heart failure treatment, omecamtiv mecarbil, being tested in two mid-stage studies in collaboration with Amgen Inc (AMGN.O).
"I think there's a lot of value left here," Needham & Co analyst Chad Messer told Reuters.
The strength of the remaining pipeline "makes it a great buy at (current) prices", Messer said.
The stock, the Nasdaq's biggest percentage loser, was down 61 percent at $5.03 in late morning trading.
The shares have climbed about 33 percent since Monday in anticipation of the trial data.
"The value of the omecamtiv mecarbil program should buffer" tirasemtiv's failure, Roth Capital Partners analyst Joseph Pantginis said, reiterating his "buy" rating on the stock but cutting his price target to $13 from $25.
San Francisco-based Cytokinetics said it planned to evaluate the detailed results of the trial in order to determine the next steps for the ALS treatment, though analysts were skeptical of its chances.
ALS, sometimes referred to as motor neurone disease, is an invariably fatal neurological disorder that attacks nerve cells located in the brain and the spinal cord responsible for controlling voluntary muscles.
Unable to function, muscles gradually weaken and waste away. Eventually, the brain's ability to start and control voluntary movement is lost, and the patient succumbs to the disease - usually three to five years from the onset of symptoms.
The disease, whose cause is largely unknown, garnered international attention after New York Yankees player Lou Gehrig abruptly retired from baseball in 1939, after being diagnosed with ALS.
The only approved ALS medicine, generic riluzole, is designed to slow the disease's progression. Cytokinetics's tirasemtiv sought to increase muscle sensitivity to calcium, resulting in enhanced skeletal muscle force and slowing of time to muscle fatigue.
About 5,600 people in the United States are diagnosed with ALS annually, according to ALS Association estimates.
(Reporting by Natalie Grover in Bangalore; Editing by Maju Samuel)