After Kerrisdale predictions of failure, Prothena dumps AL amyloidosis drug

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(Natalie Murphy)

Prothena missed primary and secondary endpoints in its key AL amyloidosis drug NEOD001 in a midstage test, with predictions it also wouldn’t cut it in phase 3, leading the company to dump work on the therapy.

To many, this will not come as a surprise if they had read the report last November by Kerrisdale, a firm well-known for its short activism on biotech stocks, but which seemed to have called the shots accurately on this company.

Last year, it saw Prothena as the “next big biotech blowup,” adding: “We are certain that its lead asset, NEOD001, will fail its ongoing phase 2b and phase 3 trials.”

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And so that rang true, with data out this morning showing it failed its primary endpoint, namely cardiac best response (NT-proBNP, modified consensus criteria) through 12 months of treatment, which failed to best placebo in the phase 2 test. It was much the same across its secondaries, too.

This experimental mAb targets the circulating soluble and deposited aggregated amyloid that accumulates in patients with AL amyloidosis, and can cause organ damage and failure.

In light of these data, the biotech said it had also asked the data monitoring committee (DMC) to look at its phase 3 VITAL study of the drug “to review a futility analysis.” The news was not good: The DMC recommended discontinuation of the VITAL study for futility.

“The company therefore decided to discontinue all development of NEOD001, including the VITAL study as well as the open label extension studies,” it said in a statement. This puts to bed a drug that could have achieved blockbuster status, had it worked.  

“We are deeply disappointed by this outcome, particularly for patients suffering from this devastating disease," said Gene Kinney, Ph.D., president and CEO of Prothena. “We are surprised by the results from these two placebo-controlled studies and will continue to analyze the resulting data to share insights with our collaborators in the scientific, medical and advocacy communities. We thank all of the patients, their families, caregivers, investigators, study staff and our employees.”

The biotech has had a mixed year in terms of data; in April last year, it saw positive early-stage data from a Roche-partnered program that aims to find a disease-modifying therapy for Parkinson's disease. The drug—called PRX002—targets alpha-synuclein, a protein that is garnering increasing attention among Parkinson's disease researchers. It’s now moving into phase 2.

But in September, the company was hit when it decided to abandon a T helper (Th) cell-targeting drug after it failed to hit the mark in a phase 1b study in psoriasis—and despite earlier data indicating it could also be a treatment option for multiple sclerosis. The PRX003 antibody—which targets the MCAM cell adhesion molecule (also known as CD146) on Th cells—was actually able to demonstrate it was having the desired biological effect in the 33-patient trial, but that didn’t translate into any “meaningful clinical benefit” for psoriasis patients.

It also lost Sarah Noonberg, M.D., Ph.D., as its CMO just a few months back when she jumped ship to Protagonist, another omen for some that things were not all well.

But a month ago it signed a potential $2 billion biobucks pact with Celgene to develop new drugs for neurodegenerative diseases, a bright spot the company was in much need of.

Late last year, before the Kerrisdale attack, the biotech, which was spun out of Elan back in 2012, had a market cap of around $2.3 billion. Around 30% of its shares are owned by Neil Woodford, the once-star investor whose light has dimmed over the past year, and dimmed even more today.

Analysts at Jefferies said in a note to clients this morning: "This is the worst case scenario for this program unfortunately for PRTA at this time. Cash estimated at end of Q2:18 is around $12/share ($480M or so) and pipeline assets could get minor value depending on investor time horizon. After the recent CELG deal, PRTA has cash value plus other pipeline programs that could get some value over time (1) Roche partnered '002 for Parkinson's disease in Phase II ongoing, (2) TTR amyloidosis antibody entering clinic soon, (3) early stage CELG partnership for neuro assets."

Its shares dropped 60% premarket on the news, down to 70% in mid-morning trading. 

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