Shares of Avigen went into a free fall after the developer announced that its mid-stage trial for an experimental therapy for spasticity associated with multiple sclerosis failed to meet its primary endpoint. Patients taking AV650 failed to demonstrate a statistically significant improvement in increased resistance to passive limb movement when compared to the group taking a placebo. Avigen's shares plunged 70 percent on the news.
Avigen announced that it will now switch its focus to AV411, which is in development for neuropathic pain and opioid addiction and withdrawal. The biotech also tried to assure investors, saying that it would have $50 million in cash and securities on hand at the end of this year. That's enough money to fund operations for two years.
"We are disappointed with the result of this trial," said Kenneth Chahine, Ph.D., J.D., Avigen's president and CEO. "We had hoped AV650 would become an important new treatment option for people in the United States who currently suffer from spasticity. While we will continue to review the additional data from the trial and consider further options, we are confident in the trial design and the quality of the top-line results.
- check out the Avigen release