Shares of Poniard Pharmaceuticals Inc. crashed Monday after the company said its cancer drug picoplatin missed its goal in a clinical trial.
The company said patients who took picoplatin as a treatment for relapsed lung cancer did not survive significantly longer than those who received only the best available care. In afternoon trading, Poniard shares dropped $5.92, or 78.1 percent, to $1.66, their lowest price since March.
"This is clearly a disappointing and surprising outcome," said BMO Capital Markets analyst Jason Zhang. He said picoplatin appeared to work as well as it had in earlier studies, but other treatments worked better than expected. Zhang previously thought picoplatin had a "reasonably good chance" of succeeding, and expected patients on the drug would live 35 to 40 percent longer.
Zhang thinks the Food and Drug Administration probably won't approve picoplatin based on results from the late stage trial, and noted the South San Francisco company is running low on cash. He downgraded Poniard shares to "Market Perform" from "Outperform."
About 26 million Poniard shares changed hands by early afternoon. In a typical full day, about 708,000 shares are traded.
Disclosure: No positions