Why Achillion Pharmaceuticals Crashed Today

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What happened

Shares of Achillion Pharmaceuticals (NASDAQ: ACHN) had plunged 22.8% as of the market close on Monday. The sell-off appeared to reflect investor nervousness ahead of the biotech's announcement of interim clinical-trial data from phase 2 clinical trials in C3 glomerulopathy (C3G) and paroxysmal nocturnal hemoglobinuria (PNH) and phase 1 data for Achillion's next-generation factor D inhibitors.

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So what

Today's drop might mean nothing for Achillion. It could just be another wild day for a highly volatile clinical-stage biotech stock.

Achillion has experienced a crazy year so far in 2018. Its stock has swung up and down -- sometimes on related news and sometimes on no news at all. Investors have their hopes pinned on success for experimental factor D inhibitor ACH-4471.

However, it's possible that news of the phase 2 data for ACH-4471 leaked ahead of Achillion's update. If so, the big sell-off could mean that the interim results for the drug in treating C3G and/or PNH are disappointing. At the time of this writing, though, there was no way to know for sure if such a leak occurred.

Now what

There's a lot riding on the performance of ACH-4471 in the phase 2 studies. The drug is Achillion's lead candidate. The biotech's other two pipeline programs are only in early stage clinical testing.

Tuesday could be a completely different story for Achillion if today's decline only stemmed from fear and worry rather than disappointing results. However, everything hinges on those results, which were scheduled to be announced at 4:30 p.m. EST today.