Acorda stock drops 40% on patient deaths related to its Parkinson’s drug
Acorda Therapeutics Inc. announced the worst news for a drug company early Wednesday. Several patients taking its Parkinson’s disease treatment died during clinical trials, and others experienced serious blood-related side effects.
Acorda ACOR, -38.83% stock was slammed in extremely heavy Wednesday trade, declining nearly 40%.
The company will continue to study the drug, tozadenant, in late-stage clinical trials, though it is now monitoring patients’ blood cell count more frequently and has halted new patient enrollment in long-term safety studies.
The update “comes as a major surprise just ahead of top-line phase III results,” which are expected early next year, said Leerink Partners analyst Paul Matteis. This also “will complicate significantly the risk/benefit of Tozadenant, even if it does succeed on efficacy in phase III.”
Read more: Acorda Therapeutics’ stock pummeled as drug study enrollment halted after patient deaths
Agranulocytosis, a serious condition relating to low white blood cell levels, and sepsis, a life-threatening blood infection, were both observed in patients on tozadenant but were not known safety issues with that class of drugs, the company said.
Five patients on the drug died of sepsis, of seven total cases of sepsis, the company said Wednesday. Four of the sepsis cases were “associated” with agranulocytosis, according to Acorda.
Sepsis and agranulocytosis can be linked, so it’s possible the sepsis deaths could be connected to agranulocytosis. That’s something the company is “still determining,” a spokesperson said.
There were also six patient deaths on tozadenant in a previous, phase 2 trial.
Though three deaths were related to sepsis, “all were for differing reasons and all were judged to be random,” said spokesperson Tierney Saccavino.
The news highlights a common problem in drug development: When studying serious diseases, it can be difficult for researchers to discern whether safety issues are related to the drug or the disease itself.
But “there’s a point at which you have enough cases at which it no longer looks random,” said Chief Executive Ron Cohen.
See: Acorda Parkinson’s drug results shot its stock up 13%. Why Wall Street is still cautious
Tozadenant was acquired, along with three other drugs, in Acorda’s roughly $ 363 million acquisition of biotech Biotie Therapies Corp. just last year. Tozadenant was in late-stage development, and was the most-advanced product purchased in the deal.
In the 2016 announcement, Acorda emphasized tozadenant’s value, touting its clinical trial results and saying that it expected to file for approval by the end of 2018.
The company said Wednesday that it still expects to release late-stage trial results early next year, since about 90% of the trial is done.
But the company is waiting to hear back from an independent Data Safety Monitoring Board and the Food and Drug Administration about resuming enrollment in the two tozadenant long-term safety studies, which are both part of the drug’s phase 3 program. The company doesn’t have a timeline for those reviews, Cohen said.
Related: Acorda stock plummets 26% on ‘surprising, puzzling, disconcerting’ FDA drug decision
Responding to analyst concerns about the safety issues causing patients to drop out of the trial, Acorda’s Cohen said that “in the unlikely event that everyone tomorrow were to drop out of the study, we’d still be able to unblind and have a good data set to deal with.”
Investors, however, will likely “remove most or all of their credit for Tozadenant from the ACOR valuation on this update,” Matteis said.
The news is the second big disappointment for investors in recent months. Over the summer, the FDA declined to allow Acorda file for approval of its Parkinson’s disease therapy Inbrija, citing questions related to the manufacturing process.
Acorda shares have surged 33% over the last three months, compared with a 4.6% rise in the S&P 500 SPX, -0.50% and a 6.4% rise in the Dow Jones Industrial Average DJX, -0.55%