Palm Beach, FL 11/8/11 (StreetBeat) -- Targacept Inc. (Nasdaq: TRGT), developer of an experimental depression treatment with AstraZeneca Plc (NYSE: AZN), had a record drop after the companies said the drug failed to meet the main goal of a clinical trial.Targacept fell 57 percent to $8.14 at 10:37 a.m. New York time, after earlier sinking to $8.46 for the biggest intra-day decline since the company sold stock to the public in April 2006. The shares had fallen 28 percent this year before today.
The drug, TC-5214, was tested as an add-on treatment in the trial in patients with major depressive disorder for whom antidepressants alone didn’t work, London-based AstraZeneca and Targacept said in a statement today. The medicine didn’t meet its primary goal of change on the Montgomery-Asberg Depression Rating Scale (MADRS) after eight weeks of treatment with TC-5214 as compared with placebo, the companies said. The MADRS scale measures depressive symptoms and is commonly used in clinical studies.
TC-5214 is Targacept's lead pipeline product so Tuesday's clinical trial failure is a major setback. Targacept and AstraZeneca provided few details in Tuesday's media announcement so its unclear what actually happened in the trial and what it means for the remaining three phase III studies still underway. Data from those studies are expected next year.
The main phase II study of TC-5214 conducted in 2009 produced spectacular results. TC-5214's efficacy was so strong that some investors thought the data were too good to be true, especially because the study was conducted largely in India. AstraZeneca believed in TC-5214 enough to license the drug from Targacept in late 2009 for blockbuster terms.
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