Shares of ProQR Therapeutics (PRQR -4.83%), a clinical-stage biopharmaceutical company, are sinking in response to lousy clinical trial results. The company's lead candidate, sepofarsen, failed to meet the primary endpoint in the Illuminate study. The stock was down 75.1% as of 12:08 p.m. ET on Friday.
ProQR didn't have anything good to say about the long-anticipated results that investors had hoped would support the company's first new drug application. Sepofarsen failed to improve visual acuity for patients with CEP290-mediated Leber congenital amaurosis 10 (LCA10), the primary endpoint of the study. It even failed to meet secondary endpoints.
LCA10 is an ultrarare genetic disorder that leads to blindness for around 15,000 people in the U.S. and European Union combined. In 2017, the U.S. Food and Drug Administration approved a gene therapy called Luxturna for patients with a slightly different form of the disease.
Since Luxturna is a gene therapy to be administered only once, Roche, the company that acquired it, needs to charge an arm and a leg up front to recoup its investment. Sepofarsen is an RNA-based therapy meant to be administered every six months, which could have made it far easier to sell.
Roche acquired the company that initially developed Luxturna for $4.3 billion back in 2019. Following today's flop, ProQR investors can forget about receiving a similar buyout offer for the foreseeable future. All of ProQR's clinical-stage drug development programs are RNA therapies similar to sepofarsen and are focused on inherited vision disorders.
ProQR finished September with around $202 million in cash after burning through $43 million in the first nine months of 2021. Today, management said there is enough cash on hand to reach mid to late 2024 before the company needs to raise capital again.
ProQR's cash runway gives its pipeline time to shine, but trying to catch this falling knife probably isn't a good idea. Until we see some convincing signs of efficacy, it's probably best to steer clear of this stock.