(Reuters) - Tonix Pharmaceuticals Holding Corp said it would stop developing its drug for fibromyalgia after the treatment failed in a late-stage trial, sending its shares down nearly 60 percent.
The company said on Tuesday it would now focus on a late-stage study of the drug, TNX-102 SL, in patients with post-traumatic stress disorder (PTSD).
Fibromyalgia, a chronic disorder characterized by musculoskeletal pain, fatigue and sleep disturbances, has no known cure, with treatments focusing on symptoms.
Preliminary data from the study showed that the drug did not meet the main goal of reducing pain in fibromyalgia patients by 30 percent or more over a 12-week period, Tonix said.
The drug has shown a stronger effect on PTSD patients than on those suffering from fibromyalgia, Chief Executive Seth Lederman told Reuters.
“We decided that PTSD was the better choice for us,” he said, adding that the treatment had the potential to get “breakthrough therapy” status for the condition.
Lederman said that Tonix would probably have had to conduct two late-stage trials each for PTSD and fibromyalgia if it chose to develop the drug for both conditions.
The company, which had cash and cash equivalents of about $31.2 million at the end of June 30, will need additional funding to complete its PTSD program, he said.
Tonix said in May that it could start a late-stage study on the drug for PTSD in the first quarter of 2017.
If the drug succeeds in the trial and is approved by the U.S. Food and Drug Administration, it will be the first new treatment for PTSD in over 15 years.
Breakthrough therapy status speeds up the review process for medicines that could potentially treat serious or life-threatening conditions better than existing treatments.
PTSD affects about 8.4 million Americans, mainly military personnel, and is a severely debilitating condition in which patients relive traumas from the past in the form of intrusive memories, flashbacks and nightmares.
Tonix has partnered with the U.S. Department of Defense to develop the treatment.
Roth Capital Partners analyst Scott Henry wrote in a note that he remained positive on Tonix’s PTSD program, but would now scrutinize the program more closely as it was the focus for the drug developer.
Tonix shares were down 53 percent at $1.03 in late morning trading, wiping about $30 million from the company’s market value. The stock touched a record low of 92 cents earlier.
Reporting by Ankur Banerjee and Shailesh Kuber in Bengaluru; Editing by Ted Kerr and Kirti Pandey