Shares of Edge Therapeutics were in free fall Wednesday afternoon following the company’s decision to discontinue development of a late stage treatment for adults with aneurysmal subarachnoid hemorrhage (aSAH).
Shares of Edge Therapeutics were in free fall Wednesday afternoon following the company’s decision to discontinue development of a late stage treatment for adults with aneurysmal subarachnoid hemorrhage (aSAH).
Not only will New Jersey-based Edge discontinue development of its lead candidate, the company is preparing to layoff an unknown number of staff as a result. On Wednesday Edge announced the decision to terminate the program after an Independent Data Monitoring Committee said EG-1962 “demonstrated a low probability of achieving a statistically-significant difference” in comparison to standard of care treatment. EG-1962 is the only drug that Edge has in clinical development. When the company released the DMC’s announcement investors scattered and the stock crashed. Shares fell about 92 percent Wednesday, from $14.59 to $1.30.
Edge’s EG-1962 is a novel polymeric microparticle that contains nimodipine suspended in a diluent of sodium hyaluronate. It was designed to be administered through an external ventricular drain. The medicine was being developed to treat adults with aSAH, which is bleeding that occurs in the space between the brain and the surrounding membrane. When untreated, a subarachnoid hemorrhage can lead to permanent brain damage or death. Generic nimodipine, a calcium channel blocker, is the go-to drug for aSAH. Edge though believed its EG-1962 therapy, which used the company’s proprietary Precisa platform, could deliver a stronger dose of nimodipine than current products. Georgia-based Arbor Pharmaceuticals is the maker of branded Nymalize (nimodipine).
In the United States approximately 35,000 people with an average age of 52 are hospitalized each year for aSAH. Of those patients, about 75 percent of these patients die or suffer permanent brain damage within 30 days, according to information provided by EDGE.
A little more than one year ago when the company randomized its first patient in the late-stage trial, Edge said it expected EG-1962 to transform the treatment possibilities for aSAH patients. Now, the company will fight for its future. Edge said it will conduct an analysis of the cumulative unblinded data from the Phase III study in order to better understand what happened. Company officials especially want to know why the drug was not on track to succeed given the positive outcomes of its Phase I/II treatment, said Brian A. Leuthner, Edge’s president and chief executive officer.
As a result of the failure Edge said it anticipates a reduction in workforce in order to preserve case resources of $88 million. However, the company did not provide any additional details as to how many of its employees it could cut in wake of the failure.
EG-1962 is the only drug candidate that Edge has in the clinic. While the Phase III program is being shuttered, Edge has explored other methods of delivering EG-1962 to patients, but the work remains in the early stages. According to its website the company has one other asset, EG-1964, which is being developed for the treatment of chronic subdural hematoma. EG-1064 has moved into a pre-IND filing stage.
