Shares of AtheroGenics spiked 20% in early trading yesterday on the news that its anti-oxidant, anti-inflammatory heart disease medication AGI-1067, which was recently reported to have failed to meet its primary goal, has met several secondary goals. Last week, the shares lost almost 61% on news of the drug's primary goal failure. As of last month, 51% of its shares had been shorted on expectations of bad news. The study's primary goal was to show that the drug reduced the risk of a set of "major cardiovascular events" by 20% among high-risk heart patients. Though the drug did not meet that goal, it did reduce by 19% the risk of cardiovascular death, heart attack and stroke. Unexpectedly, the drug also reduced diabetes risk by 64%. AstraZeneca, which has a JV with AtheroGenics, has 45 days after the conclusion of its analysis of the data to decide if it wishes to pursue further clinical studies. It has the option to pay up to $1 billion for exclusive rights to the drug.
Sources: Reuters, MarketWatch
Commentary: AtheroGenics' Uncertainty Continues, Will Remain for Some Time • AtheroGenics' Heart Drug Misses Primary Endpoint, Shares Plummet • Atherogenics Inc. Rebounds As the Shorts Cash In
Stocks/ETFs to watch: AtheroGenics, Inc. (AGIX), AstraZeneca plc [ADR] (AZN). Competitors: Glaxosmithkline plc (GSK), Novartis AG (NVS), Pfizer Inc. (PFE). ETFs: iShares MSCI EAFE Growth Index (EFG), Market 2000 HOLDRs (MKH), iShares S&P Global Healthcare (IXJ)
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