Eleven Biotherapeutics Stock Nosedives 80% Premarket as Eye Drug Flunks Phase III Test

Published: May 19, 2015

Eleven Biotherapeutics Stock Nose-Dives 75% Premarket as Eye Drug Flunks Phase III Test
May 18, 2015
By Mark Terry and Riley McDermid, BioSpace.com Breaking News Staff

Cambridge, Mass.-based Eleven Biotherapeutics , announced disappointing Phase III clinical trial results for its optical therapeutic today, causing its share price to plummet more than 80 percent in early trading.

The first pivotal Phase II study of EBI-005 for the treatment of moderate to severe dry eye had as co-primary endpoints the total corneal fluorescein staining score and patient-reported evaluations of ocular pain and discomfort. The drug did not meet either of the two co-primary endpoints.

Maxim Jacobs, analyst at Edison Investment Research in New York, said Eleven's rocky results were a blow to the company, but not out of the blue.

“The Phase III results of EBI-005 in dry eye are very disappointing but not particularly surprising given the very mixed results from their initial Phase I/II trial in which certain efficacy measures showed little to no change versus placebo. The EBI-005 program would likely have benefited from further product development before the company initiated a large and expensive Phase III program.”

Company executives echoed that sentiment in a statement Monday.

“We are disappointed that our Phase III study in dry eye disease did not meet its primary efficacy endpoints, but we are encouraged that we continue to see a favorable tolerability profile for EBI-005,” said Abbie Celniker, president and chief executive officer of Eleven Biotherapeutics in a statement. “Our key focus will be on continuing to developing EBI-005 to meet unmet medical needs in allergic conjunctivitis, based on our previously-reported Phase II data and scientific rationale supporting EBI-005 as a treatment for allergic conjunctivitis.”

The company indicated it would not start a second Phase III study on EBI-005 in dry eye disease because of the lack of positive data. Celniker, however, did state that the company needs “to further assess the results from the OASIS study to fully inform our evaluation of future plans in dry eye disease, including the ongoing Phase III safety study.”

The company has about $59 million in cash and cash equivalents, which it indicates will be used to finance current operations into the second half of 2016. It also has about $15 million in debt.

Company stock took a dive in premarket trading this morning after the news, dropping about 81 percent.

Eleven Biotherapeutics stock was fairly steady until April 2, 2015, when it dropped to $7.66 per share. It rebounded sharply to $13.43 on May 13, 2015 and is currently selling for $11.97.

EBI-005 is a topical treatment that is designed to decrease inflammation of the eye by blocking the interleukin-1 receptor. The study found no statistically significant benefit over placebo. An earlier study last year showed statistically significant improvement in treating the symptoms of allergic conjunctivitis.

Earlier in the year Paris-based Neuroptis announced positive results from a second animal trial of its ML7 eye drops for dry eye syndrome. The study was conducted with Charles River CRO in Boston, Mass. in rabbits.

On April 9, 2015, the U.S. Food and Drug Administration (FDA) granted Shire a New drug Application (NDA) for lifitegrast and a Priority Review designation, for the treatment of dry eye disease.

“The symptoms of dry eye are one of the most common complaints from patients, yet there remains a tremendous unmet need,” said Stephen Pflugfelder, professor of Opthalmology at Baylor College of Medicine in a statement. “It’s encouraging to see Shire moving the program for lifitegrast forward.”

According to Visiongain, the global market for dry eye syndromes is estimated at $1.2 billion.

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