Biotechs Have No Business in This Indication

Don't let it get away!

Keep track of the stocks that matter to you.

Help yourself with the Fool's FREE and easy new watchlist service today.

Anthera Pharmaceuticals (Nasdaq: ANTH  ) spiraled downward this week after announcing that it's stopping its acute coronary syndrome treatment varespladib because there was little chance the drug would be able to beat placebo during the remainder of the trial.

One has to wonder whether the company should have been running the trial in the first place, since heart drugs aren't very appropriate for biotechs. They're high-risk, high-reward prospects that require a lot of dough, and the FDA now requires drugmakers to show that heart drugs improve outcomes, in terms of things like heart attacks, strokes, and hospitalizations. Markers such as cholesterol levels aren't sufficient.

Anthera was treating sick patients with acute coronary syndromes, so it followed the patients for only 16 weeks for the primary endpoint. Even so, Anthera planned on enrolling some 6,500 patients into the trial. That's not as much as Merck (NYSE: MRK  ) had to enroll in its phase 3 trials of vorapaxar or GlaxoSmithKline (NYSE: GSK  ) for darapladib, but it's still no small feat for a biotech.

The company didn't give any hints as to what went wrong. It's possible that the markers used in the phase 2 trial didn't translate into improved outcomes, but it's also possible that Anthea just needed to run a longer (cha-ching) and/or larger (cha-ching) trial to demonstrate a difference in the population taking varespladib and Pfizer's (NYSE: PFE  ) Lipitor from those taking Lipitor alone.

About the only positive is that the company was smart enough to build in futility monitoring so it didn't waste any more money on a trial that wasn't going to work. Presumably, Anthera will ditch varespladib at this point, but if it's able to figure out what went wrong, I'd suggest getting a partner to foot the bill. Pronto.

Anthera is left with blisibimod, which treats lupus, another high-risk, high-reward disease. Before Human Genome Sciences' (Nasdaq: HGSI  ) Benlysta, there were a lot of drugs that failed to show an effect on the complicated disease. But it's still a more appropriate indication for a biotech to be developing a drug in, because the clinical trials required to demonstrate efficacy are much smaller; Benlysta's phase 3 trials enrolled 865 and 819 patients.

Fool co-founder David Gardner has a strategy for finding high-reward companies. You can get more details on the six signs to look for in the new free report, "Discover the Next Rule-Breaking Multibagger." Get your copy for free.

Fool contributor Brian Orelli holds no position in any company mentioned. Check out his holdings and a short bio. Motley Fool newsletter services have recommended buying shares of Pfizer and GlaxoSmithKline. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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.

Compare Brokers

Fool Disclosure

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: 1824409, ~/Articles/ArticleHandler.aspx, 10/26/2016 9:23:28 PM

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 7 minutes ago Sponsored by:
DOW 18,199.33 30.06 0.17%
S&P 500 2,139.43 -3.73 -0.17%
NASD 5,250.27 -33.13 -0.63%

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

10/26/2016 4:00 PM
ANTH $2.44 Down -0.07 -2.79%
Anthera Pharmaceut… CAPS Rating: ***
GSK $40.34 Up +0.02 +0.05%
GlaxoSmithKline CAPS Rating: ***
HGSI.DL $0.00 Down +0.00 +0.00%
Human Genome Scien… CAPS Rating: **
MRK $60.87 Down -1.08 -1.74%
Merck and Co. CAPS Rating: ****
PFE $32.40 Up +0.12 +0.37%
Pfizer CAPS Rating: ****