SHARES IN Elan lost almost a third of their value on the Dublin market yesterday after detailed clinical data on the group's Alzheimer's disease drug development programme failed to live up to market expectations.
Last night, the shares were nursing losses of almost 40 per cent on the US market, while Wyeth, its partner in the development of the drug bapineuzumab, saw its stock fall to a four-year low.
However, in a series of briefings yesterday, Elan said it remained confident of the prospects for bapineuzumab, and is currently enrolling patients for a Phase III trial of the drug.
Bapineuzumab, or AAB-001, is one of the most keenly watched drugs under development in the pharmaceuticals industry, reflecting the huge need for effective dementia treatments.
But the market took fright at several issues that emerged in a detailed presentation of Phase II clinical trial data to the Alzheimer's Association's International Conference on Alzheimer's Disease (ICAD) in Chicago overnight.
Chief among these was the disclosue that 12 of the 234 patients testing the drug suffered vasongenic edema - a significant side effect, although all recovered and half later rejoined the trial.
The data breakdown confirmed that carriers of the ApoE4 gene who account for around half of Alzheimer's sufferers showed no significant improvement during the 18-month trial and were more suspect to experience vasogenic edmea.
However, it showed that there were significant improvements in patients who did not carry the gene.
Elan's chief scientific officer Dale Schenk stressed yesterday that Phase II trials were aimed primarily at assessing the safety of drugs under development while, hopefully, providing some guidance on efficacy.
"To our surprise, there was a very robust effect - larger changes than have ever been seen - in those patients who are not carriers of the ApoE4 gene."
While the numbers were small, Dr Shenk insisted they were significant. He said the companies had adjusted the design of the Phase III trials to take account of the findings.
The trials slowed memory loss better than existing treatments for some patients screened with a genetic test.
Patients without the gene improved five points on a 70-point test widely used in Alzheimer's drug trials. The test measures memory, language use, and attention. The leading Alzheimer's drug, Pfizer's Aricept, improved performance an average 2.5 points in previous tests, said Ronald Black, assistant vice-president of neuroscience at Wyeth.
Analysts described yesterday's share price collapse as a "knee-jerk reaction" and said it was overdone, although Goodbody analyst Ian Hunter said the release of the results release "raised questions, which tempered the enthusiasm that had built up in the run-up to the ICAD meeting".
"The issue of the full data has, perhaps, seen a return to reality," he said as he reduced his target price for Elan to $28.50 from $33.
- (Additional reporting Reuters /Bloomberg)
