Targacept tanks (again) after its last surviving drug program flops

Targacept CEO Stephen Hill

The litany of clinical trial disasters that has played out at Targacept over the past three years continues this morning with the news that its last remaining pipeline asset failed a Phase I/II study for diabetic gastroparesis. And as has happened so many times before, the biotech's share price ($TRGT) took another nasty tumble, dropping 22%.

TC-6499 did not meet the primary endpoint of the study, Targacept said, without a statistically significant change in gastric emptying half-time compared to a placebo. And CEO Stephen Hill, who recently executed a reverse merger deal to allow Catalyst Biosciences to go onto Nasdaq, threw in the last towel.

"The results we saw do not support the prior signal we had seen suggesting that TC-6499 might increase gastric motility in this patient population," said Hill in a statement. "While TC-6499 did demonstrate a positive safety and tolerability profile in this study, these results do not warrant further development of TC-6499 in this therapeutic area." 

Once upon a time Winston-Salem, NC-based Targacept had a large pipeline of nicotinic receptor drugs in the clinic for depression, Alzheimer's and more. But AstraZeneca ($AZN) officially dumped their partnership last fall, after TC-5214 failed all four late-stage studies in depression and an Alzheimer's drug flopped as well.

Catalyst CEO Nassim Usman

That left a last-ditch effort for TC-6499 and opened the door for Catalyst to come in for the reverse merger.

Catalyst, though, has experienced its own setbacks. After announcing the deal with Targacept and claiming success in a 4-year Phase I study of an experimental hemophilia treatment, Pfizer ($PFE) dropped its $500 million collaboration deal. That left Catalyst CEO Nassim Usman pondering the implications for his reverse merger, just days before Targacept abandoned its final program. 

- here's the release