Regado halts pivotal lead drug trial, pipeline in jeopardy
(Reuters) - Regado Biosciences Inc lost more than half its market value on Monday after saying it terminated enrollment in a late-stage trial of its lead drug over safety concerns, creating uncertainty over the company's strategy and outlook.
The ingredients comprising the lead drug, Revolixys or REG1, are also present in Regado's second experimental drug, REG2.
"Given the safety issues associated with REG1, we are uncertain if REG2 will move forward in the clinic," Deutsche Bank analyst Robyn Karnauskas said, slashing her price target on the stock to $2 from $14.
Regado's shares had plummeted early July, after it was revealed that a data safety monitoring board (DSMB) had initiated an unplanned review of the Revolixys trial. [ID:nL4N0PE3CD]
The U.S. Food and Drug Administration had imposed a clinical hold on the trial last month.
The DSMB raised serious concerns of allergic reactions and recommended that Regado suspends enrollment in the trial, the company said on Monday.
"Given the swift and unequivocal halting of the trial (the safety review was expected to last into September) we expect the program will be terminated," Needham & co analyst Chad Messer wrote in a note.
Regado will review the trial data, Chief Executive David Mazzo said, but it is expected to take several months.
The company will have to reengineer its product pipeline and rethink its overall strategy, Liana Moussatos, an analyst at Wedbush Securities, said.
Regado has another experimental anti-platelet drug, REG3, in preclinical development. It consists of a different active ingredient.
Revolixys was being evaluated against the anticoagulant bivalirudin in patients undergoing percutaneous coronary intervention, a procedure to mechanically open or widen obstructed coronary arteries.
The drug comprises pegnivacogin, which binds to blood coagulation Factor IXa to prevent blood clotting, and anivamersen, an active control agent which rapidly reverses the anticoagulant effect, helping patients' blood return to normal.
Blood coagulation or clotting is initiated and maintained by a set of proteins in the blood, called coagulation factors, and platelets.
Regado shares, which debuted a year ago, were Monday's biggest percentage loser on the Nasdaq. They were down about 60 percent at $1.15 in afternoon trading, after touching a record low of $1.11.
Nearly 6.5 million shares of the Basking Ridge, New Jersey-based company changed hands by 12.20 p.m. ET, more than five times their 10-day average volume.
(Editing by Joyjeet Das)