Satsuma in the red after 2nd phase 3 migraine flop spurs search for strategic alternatives

New device, new trial, same flop. That is the story at Satsuma Pharmaceuticals, which suffered a second stock-crushing phase 3 belly-flop after tweaks to its migraine nasal drug delivery device failed to yield an asset capable of beating placebo. 

Two years ago, STS101, a dry-powder formulation of long-approved migraine drug dihydroergotamine, failed to beat placebo in a phase 3 clinical trial. Satsuma fingered variability in the amount of drug administered by patients as a potential cause of the flop, leading it to study a second-generation nasal spray and higher doses. After seeing early-phase data, Satsuma started a new phase 3 trial last year.

The changes failed to have the desired effect. In the latest study, STS101 was statistically no better than placebo at improving freedom from pain or each patient’s most bothersome symptom two hours after administration, causing the trial to miss its co-primary endpoints.

Satsuma dug deeper into the data to find causes for optimism, reporting significant effects on both the freedom from pain and most bothersome symptom endpoints starting three hours after treatment. The nasal spray beat placebo at five subsequent time points through to 48 hours after treatment. The clinical trial also hit secondary endpoints that looked at pain relief and rescue medication use.

As analysts at Mizuho Securities put it in a note Monday morning, "STS101 does work but doesn't appear to work fast enough to meet the 2-hour co-primary endpoints."

The ability of Satsuma to persuade others of the merits of the data will shape the future of the program. STS101 has failed two phase 3 trials, but, based on earlier talks with the FDA, Satsuma believes data from its pharmacokinetic study and long-term, open label safety trial can support approval. Yet, with its cash pile now below $60 million, the company has opted against trying to win approval itself. 

Rather, Satsuma has dropped plans for further investment in STS101 and begun looking into alternatives “to maximize value for shareholders, while minimizing cash expenditures.” Investors are holding out little hope, sending shares in Satsuma down more than 80% to well below $1 in premarket trading.