Investing in biotech companies can be either exciting or scary. Sometimes they double overnight, as Indevus Pharmaceuticals
Yeah, I'd call today's 50% drop a major haircut.
The issue? ViroPharma's phase 3 drug, maribavir, failed to show an effect in reducing cytomegalovirus (CMV) disease in stem cell transplant patients. The virus infects a lot of people, but isn't really a problem -- except when the immune system is compromised by something like a stem cell transplant or AIDS. (AstraZeneca's
As is often the case, one drug company's loss is another drug company's gain. Roche's Cytovene is currently approved for treatment of CMV, and ViroPharma hoped that maribavir would work as well as the currently available drug, with fewer side effects. Maribavir is also in a head-to-head trial against Cytovene to prevent CMV in liver transplant patients. Roche has to be feeling pretty good about its chances in that study right about now.
Tiny Vical's future is also looking a little brighter. It has a drug farther back in the clinic that won't have to compete with maribavir, should it get past the FDA.
ViroPharma licensed maribavir from GlaxoSmithKline
Maribavir is probably dead, but that doesn't mean that ViroPharma is.
Further Foolishness on faltering stocks: