Shareholders looking for good news from Vancouver-based biotech Allon Therapeutics (TSX:NPC) instead got a splash of cold water this morning.
Shares of the company were slammed after announcing that the pivotal clinical trial evaluating its lead product candidate, davunetide, as a treatment for progressive supranuclear palsy (PSP), failed to demonstrate efficacy in the trial population.
In a press release that hit the wire as the company’s stock was halted, Allon said that, after examining a series of secondary and exploratory endpoints, there was no evidence that the drug was effective.
Allon President and CEO Gordon McCauley was wistful: “This is a very sad day for patients, family members, and caregivers living with PSP because so many of them held out great hope that these results would define a drug that has an impact on their disease. Sadly these results have not fulfilled these hopes but we are deeply grateful to them for their unrelenting support of this study. While this outcome is not at all what we anticipated, we do believe that we designed the correct study and executed that study well.”
The company said it will undergo a strategic review but will not allocate any additional assets toward davunetide. Allon added it will immediately reduce its ongoing operating expenses, including a reduction in staff.
At press time, shares of Allon Therapeutics were down 94.2% to $.025.