NewLink Genetics shares fall after saying it will continue pancreatic cancer treatment study

Markets Associated Press

Shares of NewLink Genetics Corp. plunged Tuesday after the company said it would continue a cancer drug study, disappointing Wall Street's hope for early completion.

Continue Reading Below

The drug candidate, called algenpantucel-L, is aimed at treating pancreatic cancer and has received special designations from the Food and Drug Administration allowing for quicker development and a speedy review process. In a statement late Monday, the biotechnology company said it would continue the mostly complete study, unmodified.

The announcement raised concern that the study may not be going well. Specifically, the company did not meet a prespecified threshold on survival rate that would have allowed it to end the study early.

Shares of the Ames, Iowa-based company fell $13.53, or 26 percent, to $38.61 in midday trading Tuesday.

"We have indicated that if IMPRESS (the study) does not stop at the interim, investors are likely to assume that this is a failed trial," said Cantor Fitzgerald analyst Mara Goldstein, in a note to investors.

But, Goldstein said the final goal of the study is still achievable and likely to be clinically and commercially relevant should there be a clinical success.

Continue Reading Below

Meanwhile, Jefferies analyst Biren Amin said the current results have left him more cautious on the potential for the final analysis.