What happened

Shares of Idera Pharmaceuticals (IDRA) were crashing 63.5% at 10:49 a.m. EDT on Friday. The plunge came after the company announced disappointing results Thursday from a late-stage study of tilsotolimod in combination with Bristol Myers Squibb's Yervoy in treating advanced melanoma. 

So what

Idera had hoped that the tilsotolimod-Yervoy combo would sail through its pivotal study. That didn't happen.

The company reported an objective response rate (the percentage of patients with tumor-size reduction of a predefined amount) for patients taking the combo of only 8.8%. Patients receiving Yervoy by itself had an objective response rate of 8.6%.

Man wearing white medical coat giving a thumbs down

Image source: Getty Images.

Vincent Milano, Idera Pharmaceuticals CEO, said that he and his team "are surprised and disappointed" by the results from the late-stage study. What wasn't a surprise was the reaction from Wall Street. Multiple analysts quickly downgraded the biotech stock.

Now what

What's next for Idera? The company stated that it's evaluating whether or not to keep the late-stage study going to see if the tilsotolimod-Yervoy combo can meet its overall survival endpoint. There's still at least a sliver of hope that this could happen and set the stage for a path to regulatory approval. Idera will also move forward with its phase 2 study of tilsotolimod and Yervoy in treating microsatellite stable colorectal cancer.