What happened

Shares of Wave Life Sciences (NASDAQ:WVE), a clinical-stage biopharmaceutical, are plunging after the company closed the doors on its lead program. Suvodirsen flopped in a clinical trial, causing the stock to lose 53.7% as of 12:56 p.m. EST on Monday.

So what 

Wave Life Sciences is developing suvodirsen for the treatment of Duchenne muscular dystrophy (DMD), a progressive muscle-wasting disease caused by the lack of a protein called dystrophin that acts as protective sheathing between muscle fibers. During an interim assessment, investigators compared levels of dystrophin found in sample muscle tissue taken before and after treatment. Sadly, suvodirsen failed to make a meaningful difference in dystrophin levels.

Dumpster fire.

The proper analogy for what happened to Wave Life Sciences stock today. Image source: Getty Images.

Suvodirsen is the first of what the company hoped would be a long line of "stereopure" RNA-based drugs, and an improvement over the current exon-51-skipping therapy for DMD patients, Exondys 51 from Sarepta Therapeutics. Now that the first stereopure candidate to enter clinical trials has failed, though, there won't be much enthusiasm out there for the next candidates produced by Wave's proprietary drug discovery platform.

Now what

It might be hard to imagine, but today's losses would be even worse if it weren't for a couple of collaborations. A few years ago, Wave partnered with Pfizer (NYSE:PFE) to develop RNA-based treatments for metabolic diseases. Pfizer hasn't exercised its option to license any Wave programs yet, but big pharma isn't about to walk away from its up-front investment without an objective assessment.

While the Pfizer partnership doesn't appear to be going anywhere, Wave's other big pharma partner, Takeda Pharmaceutical (OTC:TKPHF), seems more confident. Takeda handed Wave $110 million up front in 2018 for options to co-develop and co-commercialize candidates aimed at Alzheimer's and Parkinson's disease.

Wave is also expected to announce results from human proof-of-concept trials with two different Huntington's disease candidates soon. We'll know if WVE-120102 has a future by the end of 2019, and interim data from WVE-120101 should be ready in early 2020.