(Adds details, CEO comment; updates shares)
Aug 1 Biota Pharmaceuticals Inc said
its influenza treatment failed to meet the main goal in a
mid-stage study, about two months after the company lost a key
government contract supporting the drug's development.
Biota's shares fell as much as 29 percent to a record low of
$2.29, making the stock one of the top percentage losers in
early trade on the Nasdaq.
The U.S. Department of Health and Human Services told the
company in April that it was pulling out of its contract to
support the drug's development with up to $231 million in
The agency did not offer a reason for ending the contract.
After losing the contract, Biota announced a restructuring
plan that included cutting its workforce by about two-thirds and
closing a facility in Melbourne, Australia.
The long-acting drug, Laninamivir octanoate, is a
neuraminidase inhibitor administered via inhalation.
Neuraminidase inhibitors, like Roche Holding AG's
Tamiflu and GlaxoSmithKline Plc's Relenza,
target a protein that enables the virus to emerge from the host
cell and reproduce.
Two doses of the drug were tested against a placebo in 639
patients to treat influenza A and B, the company said.
Patients given a 40 milligram (mg) or 80 mg dose did not
achieve a statistically significant reduction, compared with the
placebo, in the median time taken to alleviate influenza
symptoms, Biota said.
The company's partner, Daiichi Sankyo Co Ltd, has
been marketing Laninamivir octanoate in Japan since 2010 under
the brand name Inavir.
The company will not independently advance development of
the drug, Chief Executive Russell Plumb said on Friday.
Biota said it would provide detailed efficacy and safety
data from the trial in early September.
The Alpharetta, Georgia-based company's shares were trading
down 25.4 percent at $2.39.
The stock, which traded at more than $105 a decade ago, has
fallen 42 percent since the company lost the contract.
(Reporting by Natalie Grover in Bangalore; Editing by Savio
D'Souza and Simon Jennings)