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What: Shares of Ariad Pharmaceuticals (NASDAQ:ARIA), a biopharmaceutical company focused on developing therapies to treat cancer, were rocked again, falling as much as 42% after announcing the discontinuation of a late-stage trial known as Epic involving Iclusig for newly diagnosed chronic myeloid leukemia.
So what: The reason for the stoppage, as noted by Ariad, was because of a high number of arterial thromobotic events, which you may know better their less scientific name -- blood clots. According to Ariad's press release, the decision to stop the trial was mutually agreed upon between it and the Food and Drug Administration in light of news coming out last week that longer-term studies showed an increasing risk for blood clots in patients taking Iclusig.
Now what: Now I'd say Ariad is in some pretty hot water. Iclusig's current FDA approval gives the company only very minimal market share, and the drug's recent bad publicity about long-term safety may quite possibly shrink that further. To add, this early-stage CML study was supposed to be where the majority of its future revenue came from. With that now off the table, I'm not sure I see a way for Iclusig to ever get Ariad anywhere near profitability. Removing the Epic trial from the picture, out of the eight ongoing clinical studies in Ariad's pipeline, seven involve Iclusig! Given the ongoing toxicity concerns here I would, as an investor, suggest keeping a big distance from Ariad at the moment.
Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.
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