Stock Craters as Alkermes' Depression Drug Fails in Two Late-Stage Trials

Published: Jan 22, 2016

Stock Craters as Alkermes' Depression Drug Fails in Two Late-Stage Trials
January 21, 2016
By Mark Terry, Breaking News Staff

Dublin-based Alkermes plc announced today that two of its three clinical trials studying ALKS 5461 in depression failed to meet their primary endpoints.

ALKS 5461 is involved in three Phase III efficacy studies as part of a comprehensive FORWARD pivotal program. ALKS 5461 is a once-daily, oral drug to treat major depressive disorder (MDD) in patients who haven’t responded well to standard depression therapies. There are at least three studies, dubbed FORWARD 3, -4 and -5.

FORWARD-3, which evaluated ALKS 5461 (2mg/2mg) compared to placebo on 429 patients, essentially failed. Patients receiving placebo had a better response than those receiving the drug.

FORWARD-4 is more complicated. It tested two dosages, 2mg/2mg and 0.5mg/0.5mg compared to placebo. There were 385 patients in the study. The wording on this is somewhat confusing, but it appears that the 0.5mg/0.5mg dosage was ineffective, although the company doesn’t specifically say so. However, the company states, “There was a clear trend toward efficacy with the 2mg/2mg dose of ALKS 5461 on the primary endpoint, and post hoc analyses achieved statistical significance for the entire 2mg/2mg dose group on the MADRS endpoint.”

As a result, Alkermes, says that “FORWARD-4 provides supportive evidence of the efficacy of ALKS 5461 in the treatment of major depressive disorder.”

FORWARD-5, which is still ongoing, evaluated two dose levels, 2mg/2mg and 1mg/1mg compared to placebo. Based on what it has learned from the two other studies, Alkermes indicates it plans to increase patient enrollment and update its statistical analysis plan. Data is expected later this quarter.

“We are gaining important insights as we proceed with the FORWARD program for ALKS 5461,” said Elliot Ehrich, Alkermes’ chief medical officer, in a statement. “The third pivotal efficacy study, FORWARD-5, is ongoing and we plan to adapt it to incorporate findings from FORWARD-3 and FORWARD-4. Clinical trials of new medicines for the treatment of major depressive disorder are complicated by significant placebo response. We designed the FORWARD pivotal program to include three efficacy studies as we recognize that this is a challenging disease state where multiple clinical studies and expansive analyses are generally necessary to confirm the efficacy of a new medicine.”

Alkermes took the news badly. On Dec. 28, 2015, shares traded for $80.14. Shares are currently trading for $37.74. Share prices have been fairly volatile this year. On May 6, 2015, they traded for $55.80, rose to $72.10 on Sept. 18, then dropped to $55.08 on Sept. 29 before recovering to its Dec. 28 high.

The Street Quant Ratings places Alkermes stock as a “sell.” Analysts are concerned about more than its current problems with its clinical trials, stating, “The company’s weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity and weak operating cash flow.”

In comparison to the S&P 500, the company has “significantly unperformed.” Its net income decreased by 102.8 percent compared to the same quarter last year, dropping from -$39.96 million to -$81.02 million.

“We are steadfast in our commitment to developing new medicines for serious CNS conditions where there is a clear and compelling need for new treatment options for patients and their families,” said Richard Pops, Alkermes’ chief executive officer, in a statement. “Major depressive disorder is one of these conditions. We are building a large body of evidence supporting our belief in the clinical utility and the novel mechanism of action of ALKS 5461. We await the results of FORWARD-5 and will determine our next steps along the regulatory path with those results in hand.”

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