Eli Lilly and Co said it would stop developing its experimental rheumatoid arthritis drug tabalumab, nearly two months after data from a late-stage trial showed the drug was unlikely to prove effective.
The trial, one of the three late-stage trials planned for the drug, was testing tabalumab in patients with moderate-to-severe rheumatoid arthritis who had an inadequate response to initial treatment.
Lilly conducted another analysis before stopping all ongoing mid- and late-stage trials of the drug.
The decision is expected to result in a first-quarter charge of about $50 million. However, the company's financial forecast for 2013 remained unchanged.
Rheumatoid arthritis is an autoimmune disorder that causes inflammation and damage to the joints and surrounding tissues.
An estimated 1.3 million people in the United States have rheumatoid arthritis, according to advocacy group Arthritis Foundation.
Tabalumab will continue to be tested in late-stage development as a treatment for the autoimmune disorder called systemic lupus erythematosus, and in mid-stage development for multiple myeloma.
Lilly shares were down marginally at $53.79 in early trading on the New York Stock Exchange on Thursday.
(Reporting by Esha Dey in Bangalore; Editing by Don Sebastian)