Parkinson's Drug Fails Key Trial

Max · 07-27-2001, 08:28 AM

Parkinson's Drug Fails Key Trial
Guilford Stock Falls on Test-Result News; Analysts Fear Overreaction

By Justin Gillis and Terence Chea
Washington Post Staff Writers
Friday, July 27, 2001; Page E01

Shares of Guilford Pharmaceuticals Inc. of Baltimore plunged yesterday after the company disclosed disappointing results in human tests of a drug to treat Parkinson's disease.

Even before the announcement, Guilford shares fell on speculation that the drug did not work. The shares, which traded at $34 at the end of June, fell as low as $13.71 after the company made its statement in mid-afternoon, then recovered to close at $16.15, down 27 percent from Wednesday's close and 53 percent for the month.

The drug, known as NIL-A, was being tested by Guilford's partner, Amgen Inc. of Thousand Oaks, Calif., which is the world's largest biotechnology company. NIL-A is only a small part of Guilford's portfolio of potential drugs, but investors attached great significance to it because it was one of the first of a class of highly promising neurological drugs to reach advanced human testing.

These compounds, the neuroimmunophilin ligands, seem to be able to prompt damaged nerves to repair themselves without hurting normal nerve cells. The drugs have shown promise in animals for treating diseases such as Parkinson's and Alzheimer's, nerve injury, brain trauma and other conditions. If the drugs worked in people, the potential markets would be huge, since there is only poor treatment at best available for most neurological diseases.

In its statement, Guilford said Amgen's tests suggested that NIL-A, at least in the doses used and timing by which it was administered, "does not produce a substantial reversal of the motor symptoms of Parkinson's disease."

Amgen, in a conference call with analysts devoted mostly to its quarterly financial results, said it was still studying NIL-A data and had not decided the future of the drug.

Stacey Jurchison, a spokeswoman for Guilford, said that the drug showed some indications of activity in the human tests and that the company would work with Amgen to figure out how to proceed. She noted that Guilford has several other drugs in testing. "In the broad scheme of things, NIL-A is a piece of the puzzle of Guilford but one of many pieces," she said.

Financial analysts suggested yesterday that the market was overreacting to the bad news. They noted that Guilford's neuroimmunophilin drugs must be tested at varying doses on numerous diseases before their potential can be determined. They also pointed out that the start-up company, though losing money, has about $191 million in cash, enough to sustain it through a failure or two. Guilford has one product, used to treat brain cancer, on the market.

"I think people panic when they see a product with unsuccessful trial results without thinking about the rest of the pipeline," said Matthew Geller, analyst at CIBC World Markets. "I think even without this compound, the stock was underpriced. And now it's extremely underpriced."

In a report released yesterday morning, when the market was still trading on speculation, UBS Warburg analyst Andrew Gitkin said, "For those that can handle the risk, we believe this is a good buying opportunity" for Guilford shares.

© 2001 The Washington Post Company

Birde · 07-27-2001, 08:59 AM

"I think people panic when they see a product with unsuccessful trial results without thinking about the rest of the pipeline" said Matthew Geller. I Couldn't of said it better!!!!

antiquity · 07-27-2001, 09:31 AM

I agree Birde. Parkinsons is a hard disease to treat, they should have tried it on MS or SCI first.

07-27-2001, 08:28 AM	#1
Max Senior Member Join Date: Jul 2001 Location: Montreal,Province of Quebec, CANADA Posts: 15,036	Parkinson's Drug Fails Key Trial Parkinson's Drug Fails Key Trial Guilford Stock Falls on Test-Result News; Analysts Fear Overreaction By Justin Gillis and Terence Chea Washington Post Staff Writers Friday, July 27, 2001; Page E01 Shares of Guilford Pharmaceuticals Inc. of Baltimore plunged yesterday after the company disclosed disappointing results in human tests of a drug to treat Parkinson's disease. Even before the announcement, Guilford shares fell on speculation that the drug did not work. The shares, which traded at $34 at the end of June, fell as low as $13.71 after the company made its statement in mid-afternoon, then recovered to close at $16.15, down 27 percent from Wednesday's close and 53 percent for the month. The drug, known as NIL-A, was being tested by Guilford's partner, Amgen Inc. of Thousand Oaks, Calif., which is the world's largest biotechnology company. NIL-A is only a small part of Guilford's portfolio of potential drugs, but investors attached great significance to it because it was one of the first of a class of highly promising neurological drugs to reach advanced human testing. These compounds, the neuroimmunophilin ligands, seem to be able to prompt damaged nerves to repair themselves without hurting normal nerve cells. The drugs have shown promise in animals for treating diseases such as Parkinson's and Alzheimer's, nerve injury, brain trauma and other conditions. If the drugs worked in people, the potential markets would be huge, since there is only poor treatment at best available for most neurological diseases. In its statement, Guilford said Amgen's tests suggested that NIL-A, at least in the doses used and timing by which it was administered, "does not produce a substantial reversal of the motor symptoms of Parkinson's disease." Amgen, in a conference call with analysts devoted mostly to its quarterly financial results, said it was still studying NIL-A data and had not decided the future of the drug. Stacey Jurchison, a spokeswoman for Guilford, said that the drug showed some indications of activity in the human tests and that the company would work with Amgen to figure out how to proceed. She noted that Guilford has several other drugs in testing. "In the broad scheme of things, NIL-A is a piece of the puzzle of Guilford but one of many pieces," she said. Financial analysts suggested yesterday that the market was overreacting to the bad news. They noted that Guilford's neuroimmunophilin drugs must be tested at varying doses on numerous diseases before their potential can be determined. They also pointed out that the start-up company, though losing money, has about $191 million in cash, enough to sustain it through a failure or two. Guilford has one product, used to treat brain cancer, on the market. "I think people panic when they see a product with unsuccessful trial results without thinking about the rest of the pipeline," said Matthew Geller, analyst at CIBC World Markets. "I think even without this compound, the stock was underpriced. And now it's extremely underpriced." In a report released yesterday morning, when the market was still trading on speculation, UBS Warburg analyst Andrew Gitkin said, "For those that can handle the risk, we believe this is a good buying opportunity" for Guilford shares. © 2001 The Washington Post Company

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07-27-2001, 08:59 AM	#2
Birde Senior Member Join Date: Jul 2001 Posts: 131	"I think people panic when they see a product with unsuccessful trial results without thinking about the rest of the pipeline" said Matthew Geller. I Couldn't of said it better!!!!

07-27-2001, 09:31 AM	#3
antiquity Moderator Join Date: Jul 2001 Posts: 14,540	I agree Birde. Parkinsons is a hard disease to treat, they should have tried it on MS or SCI first.