Halozyme Therapeutics Inc halted a mid-stage trial testing an advanced version of its flagship drug delivery technology in patients with pancreatic cancer, sending its shares tumbling 32 percent.
The biotechnology company said it halted enrollment and patient dosing as a "precautionary measure" following the recommendation of an independent safety committee.
The pancreatic cancer study was testing a more potent form of the company's existing technology to deliver chemotherapy drugs intravenously and to prolong the effectiveness of its synthetic enzyme, Hylenex, in the blood stream.
Halozyme said on Friday the committee is assessing a possible difference in the rate of blood clots found in patients receiving its treatment against those receiving approved cancer treatments.
The setback comes after ViroPharma Inc in August halted testing of its genetic disorder drug, Cinryze, using Halozyme's existing under-the-skin delivery technology. The companies said the mid-stage trial was stopped due to several instances of higher antibody production.
A year earlier, Baxter International Inc was denied U.S. approval for its immune deficiency drug HyQvia that used the same mechanism.
Piper Jaffray analyst Charles Duncan said he expects the pancreatic cancer halt to be resolved in "weeks, not months" and that it would not hurt the broader technology platform as the dosing levels varied significantly from those of Hylenex.
Hylenex helps in the absorption of other medications by breaking down a protective barrier that surrounds skin, cartilage and abnormal tissues, including tumors.
The technology has also been licensed to drugmakers such as Pfizer Inc and Roche Holding AG.
Jefferies & Co analyst Eun Yang maintained her assumption that the pancreatic cancer treatment would be launched in the United States and Europe by 2019, and generate combined peak sales of about $548 million in 2027.
Pancreatic cancer is the fourth leading cause of cancer deaths in the United States, according to National Cancer Institute data.
The San Diego-based company's stock was down 28 percent at $8.29 in afternoon trading on the Nasdaq. Over 16 million shares changed hands by 1340 ET, more than 7 times their 10-day moving average.
The stock was the biggest percentage loser on the exchange.
(Reporting by Natalie Grover in Bangalore; Editing by Maju Samuel and Sriraj Kalluvila)