Anadys shares slump despite upbeat hep C data

Anadys Pharmaceuticals started the day by touting preliminary mid-stage data for ANA598 and got some quick support from analysts. But shares of Anadys slumped this morning, proving that it can be hard to clear the bar on investors' expectations when it comes to a hepatitis C program.

"I think this is positive data, it's just not blow-out data," ThinkEquity analyst Brian Skorney told Dow Jones. Researchers reported that four weeks into the Phase II study, 56 percent of the patients receiving the drug along with standard of care saw their viral loads reduced to undetectable levels--a goal hit by only 20 percent of the control group. Investors, though, were left hungering for a better response number. Analysts also noted that a higher number of mild rashes in the group that responded to the drug may also have startled the company's backers.

Over at Xconomy, Luke Timmerman notes that the data isn't compelling enough on its own to warrant an approval, but it's strong enough to keep the developer in the game. To gain entry into the lucrative market for new hep C cocktail therapies, Anadys will have to demonstrate a long-term response. But the initial data on a quick viral response is a signal that it may well be on the right path.

Some analysts are taking a wait-and-see approach. New data on the 12-week response rate should arrive in the first quarter of next year. And preliminary data on a high-dose group should be available in the next few months as well.

- here's the Dow Jones report
- and here's the story from Xconomy