Source: Aduro BioTech 

What: After reporting that a patient developed a serious infection while receiving its promising immunotherapy for the treatment of pancreatic cancer, shares in Aduro BioTech (NASDAQ:ADRO) fell by 15% earlier today.

So what: Aduro BioTech is working with some of the globe's biggest drugmakers, including Bristol-Myers Squibb (NYSE:BMY)on cancer therapies that rely on Aduro BioTech's unique ability to reengineer listeria bacteria to express tumor associated antigens in order to kick-start an immune response to cancer.

One of Aduro BioTech's most advanced projects is CRS-207, a listeria based therapy that is being used to battle pancreatic cancer alongside GVAX Pancreas, a cancer vaccine.  Last quarter, the company completed enrollment in a 303 patient phase 2b trial evaluating the ability of these two drugs to combat metastatic pancreatic cancer after the duo delivered promising phase 2a results showing that CRS-207 and GVAX Pancreas therapy resulted in a median overall survival of 6.1 months, compared to 3.9 months for patients receiving GVAX Pancreas monotherapy. Importantly, adverse events suffered by patients in that trial were in line with expectations and mostly tied to low white blood cell count.

Today's revelation, however, casts a new shadow of doubt on that previously promising safety profile.

In the company's quarterly filing with the SEC, Aduro BioTech disclosed that one patient receiving its therapy developed listeriosis, an infection caused by listeria that can be fatal in immuno-compromised patients such as these.

Because CRS-207 is supposed to be uniquely crafted to render listeria harmless, the discovery increases investor concerns that more cases could occur or that the FDA could place a clinical hold on the phase 2b drug trial.

Now what: According to Aduro BioTech's filing, the case was caused by a protocol violation and that after successfully receiving antibiotics the patient remains on the therapy.

That could mean that this is a unique situation, rather than a sign that CRS-207 plus GVAX Pancreas is unsafe. However, investors should always approach clinical stage companies like Aduro BioTech cautiously because the vast majority (over 90%) of clinical trials for cancer drugs fall short.

Nevertheless, harnessing the body's immune system to identify and kill cancer cells is incredibly intriguing and Aduro BioTech's got a slate of trials under way, including a pancreatic cancer trial combining CRS-207, GVAX Pancreas and Bristol-Myers Squibb's checkpoint inhibitor, Opdivo.

Results from the first phase 2b trial of CRS-207 and GVAX Pancreas are expected in the first half of next year and results from the combination study with Bristol-Myers Squibb are expected later next year, so investors should have more insight into the therapy's potential over the next 12 months.  Given the uncertainty stemming from today's revelation, however, it might be best to wait for that mature data than to step in and buy today's slide.