(Reuters) - Athersys Inc’s stem-cell therapy, its only product to reach human trials, failed a mid-stage study testing it as a treatment for a type of stroke, wiping off more than 40 percent of the company’s market value.
Data showed on Friday that patients given the therapy, MultiStem, did not show a significant difference from those given a placebo as measured by the Global Stroke Recovery Assessment scale.
The study, which was to test the safety and efficacy of the treatment given between 24 and 48 hours after an ischemic stroke, showed that MultiStem was not better than a placebo when given after 36 hours, the company said.
However, data also showed that the therapy had better efficacy when given before 36 hours.
“Unfortunately, we just didn’t have the window right for this study... We believe, investors should see this as a sign that MultiStem works,” Athersys Chief Operating Officer William Lehmann told Reuters.
Maxim Group analyst Jason Kolbert said the way forward in stroke was now clear. He expects Athersys to move forward with a global pivotal trial.
Kolbert added that the company’s partnership with Chugai Pharmaceutical Co, which is responsible for the development and marketing of the therapy in Japan, was robust and milestones from the deal were safe.
Athersys and Chugai signed the deal on MultiStem in March, in a deal worth up to $205 million in upfront and milestone payments.
MultiStem belongs to a group of stem-cell therapies called regenerative medicine.
When injected to or implanted in the patient, these stem cells turn into cells of the affected area or release substances that help existing cells survive.
Other drugmakers developing regenerative therapies are NeoStem Inc, Pluristem Therapeutics Inc, Neuralstem Inc, Cesca Therapeutics Inc and private company Mesoblast Ltd.
Maxim’s Kolbert said Mesoblast, which has partnered with Teva Pharmaceutical Industries Ltd for a line of stem-cell products, will pay attention to Athersys data and run a stroke study that will not treat patients beyond 36 hours.
Athersys is also testing MultiStem for inflammatory bowel disease, affected immunity in some forms of blood cancers, and heart attack.
Athersys shares, which started trading at about $7.75 in June 2007, fell as much as 59 percent to 90 cents in early trading on the Nasdaq. Around 12 million shares changed hands by 10:15 a.m. ET, more than four times their 10-day moving average.
Reporting by Vidya L Nathan in Bengaluru; Editing by Don Sebastian