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What: Axovant Sciences Ltd. (AXGT) dropped 11.6% in January and 17.96% today on news that Pfizer (PFE -2.01%) shuttered the development of a drug with a similar mechanism of action to its lead drug candidate.

So what: On Feb. 2, reports surfaced that Pfizer had terminated research on PF-05212377, a drug that attempts to increase acetylcholine levels by inhibiting the 5-HT6 receptor.

The news led to a sharp sell-off in Axovant Sciences shares because it's drug, RVT-101, is also an antagonist of the 5-HT6 receptor. In 2014, Axovant Sciences paid just $5 million in up front cash to rescue RVT-101 from GlaxoSmithKline's (GSK -1.95%) discard pile after it came up short in GlaxoSmithKline's previous trials.

Now what: Clinical-stage Alzheimer's disease drugs have an extraordinarily poor track record of success with about 99% of them ending up in laboratory waste baskets. Therefore, the news of Pfizer's stumble isn't too surprising.

However, investors may not want to draw a straight line between Pfizer's outcome and the potential outcome for RVT-101.

Pfizer's drug trial was for use in patients with neuropsychiatric symptoms that are notoriously tough to treat and PF-05212377 was dosed at 30 mg per day.

Meanwhile, Axovant Sciences phase 3 trials excludes patients with a history of significant psychiatric illness and that could mean that the patient populations studied in the two trials is different enough to produce a different result. Additionally, RVT-101 is being dosed at a higher 35 mg level than Pfizer's drug, which could boost efficacy.

Finally, Pfizer's primary outcome measure was determined using a change in baseline on Alzheimer's disease assessment scale-cognitive subscale with 13 items (ADAS-cog13), while Axovant Sciences' primary outcome will be measured using an 11 item scale (ADAS-cog11).

Axovant Sciences also has a second primary endpoint that will be measured using Alzheimer's disease cooperative study-activities of daily living scale (ADCS-ADL) that wasn't used by Pfizer in its study.

Because the two trials have differences, it's uncertain how RVT-101 will pain out. However, given that investing in Alzheimer's disease drugs is a big gamble, Pfizer's setback does make Axovant Sciences more risky than it already was and for that reason, only the most aggressive of buyers might want to consider investing in the company until data from RVT-101's Mindset trial comes out next year.