Despite the late-stage fail, Vistagen will nevertheless continue to push its drug candidate forward and meet with the FDA to align on a potential registrational path.
Vistagen’s intranasal drug candidate was not significantly better than placebo at easing acute symptoms in a Phase 3 study of patients with social anxiety disorder. The California biotech’s stock plummeted 70% on Tuesday, closing the trading session at $0.23 per share.
Vistagen enrolled nearly 240 patients into the late-stage PALISADE-4 study, randomly assigning participants to receive the biotech’s intranasal therapy fasedienol or placebo. Results presented on Tuesday showed the drug failed to outperform placebo at easing anxiety and distress during a simulated public speaking challenge, as measured by an emotional distress scale—missing the study’s main goal. No differences were recorded between the investigational treatment and placebo for the the trial’s secondary endpoints.
The Phase 3 failure is “disappointing,” William Blair analysts said in a Tuesday note. However, the firm conceded that it has always viewed PALISADE-4 as a high-risk endeavor for Vistagen, “given there was no separation from placebo . . . in PALISADE-3,” a separate late-stage study for acute social anxiety disorder in which fasedienol demonstrated no significant treatment benefit at the end of last year.
Despite showing no significant benefit in the newest trial, Vistagen on Tuesday said it will continue to advance fasedienol for social anxiety disorder, but this time focus on addressing the condition over time, rather than acute treatment. The biotech plans to meet with the FDA discuss a potential path forward for the drug based on a single future Phase 3 trial.
This move is informed by new draft guidance released by the FDA last week, which notes that “that there are various ways to provide substantial evidence and emphasizes the many factors that can impact the strength of evidence of effectiveness for a drug.”
Additionally bolstering Vistagen’s confidence in fasedienol is a post-hoc analysis of PALISADE-4 focusing on patients with severe social anxiety. Results of this analysis found a nominally statistically significant improvement in distress after fasdienol treatment, according to the biotech.
Stifel, however, remains unconvinced. “In our view it’s hard to put much weight on this,” the firm wrote in a Tuesday note. “This specific post-hoc analysis excludes one trial site,” as well as certain patients who were close to the “ceiling” of anxiety and distress scores, indicating that they had “little room to improve,” the analyst wrote.
“With these results, in the backdrop of a clear failure on PALISADE-3, it’s hard to have any conviction in a path forward leveraging a different primary endpoint,” Stifel added.
