What happened

Shares of Atossa Therapeutics (ATOS 0.99%) were tumbling 22.8% as of 11:36 a.m. EDT on Wednesday. The decline came after the company announced final results from its phase 2 clinical study evaluating oral endoxifen in treating breast cancer with administration between diagnosis and surgery.

So what

Today's sell-off of the biotech stock appears to be a case of investors sticking with the old adage to "buy the rumor and sell the news." Atossa's shares skyrocketed 539% year to date as of the market close on Tuesday.

The company's news was pretty good, although some investors could have been hoping for even better results. Atossa reported that oral endoxifen met the primary endpoint of the phase 2 study. The experimental drug reduced Ki-67, a measure of tumor cell activity, by 65.1% on average. Even better, all patients in the study receiving endoxifen experienced a reduction in Ki-67 to below 25%, an indication that the drug could improve long-term survival.

Healthcare professional holding a pink ribbon for breast cancer awareness.

Image source: Getty Images.

Atossa also said that endoxifen was "considered safe and well tolerated" in the phase 2 study. All of the adverse events observed in the study were mild. No adverse events led to patients discontinuing participation in the study.

Now what

What's next for Atossa? CEO Steven Quay said the company has begun a formal nonclinical toxicology program required to seek U.S. approval of oral endoxifen. He added that Atossa plans to file for approval to advance the drug into the next round of clinical testing as soon as possible.