Shares in Anglo-Swedish drugmaker AstraZeneca plunged as much as 17 percent Thursday after a new lung cancer treatment proved less successful than the company had hoped.
AstraZeneca said human trials of the drug Imfinzi failed to meet the goal of improving progression-free survival rates in patients with non-small cell lung cancer. Investors saw the results as a major setback because the company had hoped the study, known as Mystic, would show Imfinzi to be more effective than standard chemotherapy.
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"Analysts have been waiting for the numbers from the Mystic trial for months and had, admittedly tentatively, booked in billions of dollars of future sales from the combination therapy," said Nicholas Hyett, an equity analyst at Hargreaves Lansdown. "Those health-care billions will now be going elsewhere."
AstraZeneca reported the findings along with second-quarter financial results that were less than rosy as the loss of patent protection for two blockbuster drugs hurt sales. The company has been seeking to develop new treatments to fight off competition from generic drugmakers.
The potential for such drugs was repeatedly described as one of AstraZeneca's strengths when it fended off a takeover bid from U.S. drugmaker Pfizer, which makes Viagra.
Second-quarter revenue declined 10 percent to $5.05 billion as sales of the cholesterol drug Crestor fell 40 percent. Sales of the anti-depressant Seroquel XR dropped 58 percent.
Net income totaled $477 million compared with a loss of $3 million in the same quarter last year as AstraZeneca reined in costs and increased sales of cancer drugs.
But investors were more focused on data from the Mystic study of Imfinzi, a monoclonal antibody designed to make a patient's immune system attack tumors. The trial is looking at Imfinzi's effectiveness as a treatment for metastatic non-small cell lung cancer both as a standalone drug and in combination with another monoclonal antibody.
Imfinzi combined with tremelimumab didn't meet the primary goal of improving progression-free survival rates when compared with standard platinum-based chemotherapy, AstraZeneca said. Although it wasn't formally tested, Imfinzi alone also wouldn't have met goals for improving survival rates.
The trial will continue to assess overall survival of patients treated with Imfinzi alone and the Imfinzi-tremelimumab combination, AstraZeneca said. Results are expected in the first half of next year.