You'd think a drug failing to show an effect would be the worst thing that could happen to a biotech investor, but mixed results are actually much worse. Just enough efficacy to give management hope can be a dangerous thing.

Such is the life of Delcath Systems (Nasdaq: DCTH), which recently produced mixed data for its chemosaturation system to treat cancer. Last week, the company reported that nine patients with tumors of hepatobiliary origin -- that is, from the liver and bile ducts -- showed an "encouraging" response. However, no actual data was reported. Then yesterday, the company said it didn't see a response in 16 colorectal cancer patients with liver metastases.

But -- you knew it was coming -- the National Cancer Institute, which ran the trial, enrolled mostly very-late-stage colorectal cancer patients because those were the patients they had when the study was run. Delcath theorizes that the patients were so heavily treated previously that its system couldn't help them.

Delcath has preclinical data suggesting the system should work against colorectal tumors, so the company plans to run a new phase 2 trial in the second half of next year. The trial will enroll patients that are more likely to respond to the treatment.

These little hints at efficacy are everywhere in biotech. XOMA 052 failed to show an effect in diabetes, but XOMA (Nasdaq: XOMA) still seems to be holding out hope that it could be used to treat cardiovascular disease because it reduces levels of C-reactive protein. Cell Therapeutics (Nasdaq: CTIC) has been clinging onto somewhat encouraging data for its cancer drug pixantrone, despite the drug being rejected by the FDA.

The problem with hope in biotech is that it's quite expensive and often lengthy. No one will know if Delcath is wasting money going after colorectal cancer until the trial is complete, but I do know that having a management team that knows when to cut the cord on a program is worth its weight in gold -- even at these inflated prices.

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Fool contributor Brian Orelli holds no position in any company mentioned. Click here to see his holdings and a short bio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.