Image source: Getty Images.

What: Shares of Anavex Life Sciences (NASDAQ:AVXL), a clinical-stage biotech company focused on the development of drug candidates to treat Alzheimer's disease and other central nervous system disorders, plummeted by as much as 45% on Wednesday after releasing updated 31-week results from its phase 2a study involving lead compound Anavex 2-73, herein known as "2-73," at the Alzheimer's Association International Conference.

So what: According to the press release from Anavex, everything appears to be going according to plan. Per the press release,

Overall, efficacy results demonstrate what appears to be a converging and consistent response for all quantitative endpoints through 31 weeks, including cognitive and functional measures: Mini Mental State Examination (MMSE), Alzheimer's Disease Co-operative Study – Activities of Daily Living (ADCS-ADL), Cogstate and electroencephalographic activity and event-related potentials (EEG/ERP). 

But further examination of the poster results now on Anavex's website reveals a potentially different story. MMSE scores, which had been a key selling point of 2-73 at the five-week mark, have shown some slight deterioration at the 31-week mark, as you can see below.

Image source: Anavex Life Sciences. 

An argument can certainly be made that these scores are "sustained" around the baseline. However, investors who were potentially expecting an improvement, or reversal, in cognitive decline are clearly disappointed.

Additionally, the ADCS-ADL data also showed a quality-of-life score deterioration despite the poster suggesting a "maintenance" through week 31. At the midpoint of the week-31 analysis, the ADCS-ADL has hit a new low, which could imply the continuation of cognitive decline.

Image source: Anavex Life Sciences.

Don't get me wrong -- there were positives, too. The poster suggests a discernible improvement in the Hamilton Depression Rating Scale at the 31-week mark. But that's probably nowhere near enough to counteract the ambiguities of its MMSE and ADCS-ADL data.

Now what: Today's data is exactly what I warned about just two weeks ago. Although we'd witnessed promising data previously with 2-73 and a number of other earlier-stage compounds, the blood-brain barrier is tricky to tackle, and most Alzheimer's drugs fail in clinical trials.

Does today's poster release mean 2-73 is a failure? No. But it didn't exactly instill confidence that 2-73 is the drug of the future for Alzheimer's patients. There are a lot of questions to be answered by Anavex once we hit the 52-week mark, prime of which is whether we see a reversal of the MMSE and ADCS-ADL scores from the 31-week mark, where they appear to be trending lower and implying disease progression.

For now, my suggestion would be to observe Anavex safely from the sideline. There's little reason to risk your hard-earned money on a drug developer whose pipeline is still very wet behind the ears.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.