We get reminded again and again that interesting Phase II results are only that: interesting, and no guarantee of anything. Antisoma (ATSMY.PK) (and their partner Novartis (NVS)) are the latest company to illustrate that painful reality - their drug AS404 (vadimezan) looked in Phase II as if it might be a useful addition to oncology treatments, but has completely missed its endpoints in the bigger, more realistic world of Phase III. The trial was halted after an interim analysis showed basically no hope of it showing benefit if things continued.
There are many reasons for why these things happen. Phase II trials are typically smaller, and their patient populations are more carefully selected. And they're quite susceptible to wishful thinking. They're designed to keep things going, to show some reason to proceed, and they often do. If your drug candidate makes it through Phase II, that may say more about how you designed the trial than it says about the compound.
That's not to say that getting past Phase II is meaningless. Compared to having no efficacy data at all, it's a big step. But Phase III, when a compound goes out to a larger and more diverse patient population, is a much bigger one. And plenty of candidates aren't up to it.