Post-reform Roche stumbles as top schizophrenia drug fizzles in PhIII

Roche's ($RHHBY) attempt to carve out a meaningful market in neurosciences has suffered a serious setback. The pharma giant says that bitopertin (once dubbed RG1678), failed the first two of 6 Phase III studies, raising some serious doubts about a new therapy designed to address common symptoms of schizophrenia. Investigators say the treatment failed to beat out a placebo.

Sandra Horning, Roche's incoming chief medical officer and head of global product development

The GlyT-1 drug had been tapped by new pRED chief John Reed as a top blockbuster prospect for the company, a sentiment shared by analysts as well as some longtime observers of R&D. Decision Resources had assessed peak sales potential in the $1.5 billion zone, while Bank Vontobel's Andrew Weiss pegged the top at more than $2 billion.

Today, the drug is teetering on the edge of disaster--a familiar place for pRED, which has been undergoing a global restructuring and refocusing after experiencing a series of R&D pratfalls. Even after the restructuring, though, neurosciences remained a major focus at Roche as other Big Pharma companies retreated from the field or abandoned research efforts altogether.

Roche helped feed hopes for the schizophrenia drug with some promising Phase II results back in 2009, which examined the drug's impact on certain "negative" symptoms of schizophrenia, such as a lack of emotion and poor social skills. That's a hard clinical target for any drug to hit; it also helps explain why neurosciences drugs have had such a poor rate of success in recent years. Now there's one more trial left to read out on negative symptoms of the disease and three others zeroing in on poorly controlled symptoms of the disease, such as hallucinations and delusions.

"It is inherently high risk," Weiss told Bloomberg about the late-stage program. "Negative symptoms are inherently very difficult to assess. You're trying to assess mood."

"We will await data from the remaining bitopertin studies in schizophrenia before deciding on next steps," noted Sandra Horning, Roche's new head of product development, in a statement.

Reed has been on a shopping spree recently, filling up the pRED pipeline in hopes of rivaling the star developers at Genentech's gRED operation in California. Today's announcement will only add to the pharma company's hunger for new projects.

- here's the press release
- here's the Bloomberg report