Teva's Disappointing Phase 2 Results

You often see the word "pivotal" used to describe phase 3 drug trials, but I think phase 2 studies are often more crucial in the development of a drug. It's the time when a company needs to decide whether to shell out big bucks for a phase 3 trial or cut its losses.

Teva Pharmaceuticals (Nasdaq: TEVA  ) has one of those decisions to make with its lupus-treating drug, edratide. The company announced yesterday that edratide failed to meet the primary endpoint in its phase 2 trial. After 26 weeks of treatment, the drug failed to reduce lupus disease activity in subjects as measured by the Systemic Lupus Erythematosus Disease Activity Index (SLEDAI).

Teva said that it was still reviewing the data to see if the drug might have met any of the secondary endpoints the trial was designed to test. It didn't say what the endpoints were, but they likely included the ability of the drug to lower the patient's need for steroids, which have undesirable side effects.

The problem with continuing at this point is that phase 3 lupus trials take a considerable amount of time -- one to three years -- meaning they're expensive. Teva could try another phase 2 trial, but those are usually just a shot in the dark. I'd rather see the company quit while it hasn't spent too much in research and development funds on the compound.

It hasn't been the best month for lupus patients. Last week, Aspreva Pharmaceuticals (Nasdaq: ASPV  ) decided not to file a marketing application to use its CellCept drug as an induction therapy for lupus. At least Human Genome Sciences' (Nasdaq: HGSI  ) and GlaxoSmithKline's (NYSE: GSK  ) Lymphostat-B had a successful phase 2 trial and should release interim phase 3 results next year.

For Teva, the blow isn't a major one. With eight other drugs in clinical trials, around 150 generic drug applications awaiting approval from the FDA, and many attempts to break patents in court, the company still has plenty of opportunities to expand its top-line growth.


Read/Post Comments (0) | Recommend This Article (3)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 537147, ~/Articles/ArticleHandler.aspx, 10/22/2014 10:29:13 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 16,618.98 4.17 0.03%
S&P 500 1,942.01 0.73 0.04%
NASD 4,417.19 -2.29 -0.05%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/22/2014 10:13 AM
TEVA $53.60 Up +0.34 +0.64%
Teva Pharmaceutica… CAPS Rating: *****
GSK $44.81 Up +1.18 +2.70%
GlaxoSmithKline CAPS Rating: ****
HGSI.DL $0.00 Down +0.00 +0.00%
Human Genome Scien… CAPS Rating: **

Advertisement