What happened

Shares of skincare pharmaceutical specialist Dermira (NASDAQ:DERM) dropped nearly 23% today after the company hosted its investor and analyst day for 2018. Investors were none too thrilled with the presentations given -- and were only reminded about the stinging failure of a once-promising acne drug DRM01 in March. Shares slipped over 64% on that news.

Management provided more updates on how it plans to leverage sales channels and a couple of updates from the pipeline. The next two drug candidates moving through clinical trials are targeting underarm sweating and atopic dermatitis, which don't come close to matching the market for acne, even if the opportunities are combined.

As of 3:30 p.m. EDT, the stock had settled to a 23.4% loss (the lowest point of the day) and now sits near all-time lows.

A person in a suit carefully pulling a block out of a block tower.

Image source: Getty Images.

So what

Dermira presented more late-stage data for glycopyrronium tosylate, which is formulated as a once-daily wipe to combat excessive underarm sweating. However, investors aren't that excited about the opportunity. Not only is the market relatively small, but the drug candidate wrapped up phase 3 trials years ago, and the company held its first pre-New Drug Application (NDA) meeting with the U.S. Food and Drug Administration in February 2017.

In other words, it's been a slow process. Investors may get a final answer on the drug candidate's future by June 30, the deadline for the FDA to review the application for marketing approval.

Updates were also given on the next most advanced drug candidate, lebrikizumab. Dermira acquired the rights from Roche to develop the biologic drug for atopic dermatitis, also known as eczema. The phase 2 trial currently under way will reach full enrollment by the end of 2018 and top-line data will be announced in the first half of 2019.

Now what

Dermira is doing what it has to do to rebound from the failure of DRM01. Unfortunately, there just aren't any drugs with blockbuster potential coming down the pipeline. While glycopyrronium tosylate could have its marketing approval decision by the end of June, it has relatively limited sales potential. And although lebrikizumab could represent a new treatment option for eczema, it's still years away from reaching the market, if it does at all. Investors were reminded today of just how long they'll have to wait to see real progress. Some opted to head for the exits instead.

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