UPDATE 2-NMT Medical says to close trial; shares sink
(Adds analyst comments, updates stock movement)
BANGALORE, Jan 23 (Reuters) - Medical technology company NMT Medical Inc (NMTI.O) said it would close a trial testing a new migraine treatment after only a handful of patients met enrollment requirements and the study was becoming costly, pushing shares to a three-year low.
The company, which expects to save about $14 million over the next two to three years from the trial closure, said a part of the savings would be used to finance a pivotal trial in patients who may develop stroke as a result of a heart defect.
"This opportunity (for migraine) is certainly not going to be one that they will be addressing for a while," Collins Stewart analyst Keay Nakae said by phone.
Nakae, who has a "hold" rating on the stock, said the company has $30 million in cash which should "carry them a while."
NMT's technology seeks to treat brain attacks, such as embolic stroke, migraine headaches and transient ischemic attacks, by repairing a common heart defect that allows the flow of oxygen-deficient blood to the chamber holding oxygen-rich blood.
Though more than 1,400 patients had been screened for enrollment, only a handful of them met the requirements to be randomized, Chief Executive John Ahern said, adding that the trial, MIST II, was becoming expensive.
The Boston-based company's shares had fallen as much as 35 percent to $4.07, but pared some losses and were down $1.87 at $4.38 in afternoon trade on the Nasdaq.
THE STROKE TRIAL
In April last year, NMT received conditional approval from the U.S. Food and Drug Administration to modify the Closure I stroke trial and cut patient enrollment for the study by half.
Closure I, which is nearing enrollment completion in the United States, evaluates the effectiveness of NMT's STARFlex technology in preventing recurrent stroke due to a hole in the wall between the upper chambers of the heart. (Reporting by Varsha Tickoo and Esha Dey in Bangalore; Editing by Anthony Kurian, Deepak Kannan)
