The U.K.'s Phytopharm is throwing in a bad hand and cashing out of the R&D game. A month after it reported a decisive mid-stage trial failure for its Parkinson's therapy, the biotech says it has stopped spending money on R&D, plans to slash its head count and is looking to sell off its assets in ongoing talks with potential buyers.
"After discussions with major shareholders the board has initiated a review of the strategic options available to the company which includes the review of a number of merger and acquisition opportunities," the company said in a statement. "Exploratory discussions have been held with a number of parties and further updates will be made as appropriate."
The company had already been largely left for dead on the failure of Cogane, a Parkinson's drug that the biotech had raised $36 million to put into Phase II. Following a full analysis of the study, investigators concluded that the drug--derived from plants--failed to demonstrate any significant improvement compared to a placebo on either primary or secondary endpoints. And the setback followed previous failures which had raised serious doubts about the biotech's R&D strategy. Some analysts suggested that Phytopharm's chief remaining value could be as a public shell company that could be used to jump into the public market.
Phytopharm's shares ($PYM) were up a bit this morning, trading at 1.55 pence.
The failure of Phytopharm comes at a time the U.K. biotech industry was hoping to see some big successes to help repair a tattered image with investors. In the last two or three years some biotechs like Antisoma, Renovo and Minster Pharmaceuticals blew up following key trial failures, dispiriting an investment community increasingly leery of the big risk involved in drug development.
- here's the press release
- read the report from Reuters