Vical Tumbles On Vascular Drug Study Failure
From Associated Press (September 22, 2010)
NEW YORK -- Shares of drug developer Vical Inc. plunged to a 52-week low Wednesday after a drug discovered by Vical failed in a late stage clinical trial.
THE SPARK: Sanofi-Aventis SA said NV1FGF did not reach its main goal in the study. It was testing the drug as a treatment for critical limb ischemia, or blockages in the arteries of the legs. Sanofi-Aventis said the study showed that NV1FGF was no better than a placebo in preventing limb amputation or death one year after treatment.
NV1FGF is a genetic drug designed to encourage the growth of new blood vessels. In the trial, it was tested on patients who could not have revascularization procedures. The 525 patients in the trial were injected with either NV1FGF or a placebo every two weeks for six weeks.
THE BIG PICTURE: San Diego’s Vical does not have any products on the market, and makes its revenue from licenses and royalty payments along with contracts and grants. NV1FGF had advanced through earlier stages of testing, but the failure means it may never be approved and Vical won’t receive more revenue or royalties.
Sanofi-Aventis said it will evaluate all its options in developing the drug.
SHARE ACTION: In afternoon trading, Vical stock dropped $1.18, or 30.6 percent, to $2.68. Earlier, its shares fell a 52-week low of $2.26.
Posted: September 2010