BioWorld International Correspondent

Shares in Crucell NV fell 4.7 percent to €14.79 (US$18.47) in Amsterdam Tuesday on news that it had terminated development of Aerugen, a vaccine that had been undergoing a pivotal Phase III trial for prevention of Pseudomonas aeruginosa infection in cystic fibrosis patients.

The news might have reached some investors early, as the company's shares fell on Nasdaq by nearly 13 percent to $17.75 Monday, during unusually heavy trading. In contrast, the stock had fallen by less than 6 percent to close at €15.52 on the company's home exchange, the Euronext market, the same day. Shares (NASDAQ:CRXL) rose 45 cents, to close at $18.20 on Tuesday.

"There's only one conclusion there - some people knew more than the market," said Gert Jan Hoppers, analyst at F. van Lanschot Bankiers NV, located in 's-Hertogenbosch, the Netherlands.

"That might have forced them to bring out the press release in advance of their schedule," said Kenn Daniel, analyst at Fortis Bank.

Crucell's chief financial officer, Leonard Kruimer, rejected that interpretation.

"We brought out the results earlier than expected because the clinical data were so overwhelmingly clear, showing there was no statistical efficacy," he said. The Leiden, Netherlands-based company has been in touch with regulatory authorities in the U.S. and in the Netherlands, Kruimer said, but its internal procedures are "so strict" that it is "virtually unthinkable" that any price-sensitive information could have leaked out from the company.

News could have leaked out from the clinical trial, he said, but the share price drop also could have been coincidental. From discussions with brokers, Kruimer said, it appears that two institutional shareholders in the U.S. sold large volumes of shares - close to half of the 1.3 million shares that changed hands on Nasdaq Monday - which could have created a downward pressure on the share price that prompted a wider sell-off.

Crucell, of Leiden, the Netherlands, acquired Aerugen, an 8-valent conjugated vaccine, when it took over Berna Biotech AG, of Berne, Switzerland, earlier this year, in a stock-based deal originally valued at CHF591 million (US$449 million). It was the subject of a five-year study involving 476 cystic fibrosis patients, recruited through 46 centers in four countries.

Crucell said the study "failed to confirm" efficacy data obtained in a previous clinical trial. "It was a program with a very, very large risk," Kruimer said. "It is just extremely difficult to meet the clinical endpoints."

Interim analyses during the five-year Phase III study also had failed to show efficacy, but the trial was powered to show only efficacy at its conclusion, Daniel said, due to an annual dosing regimen designed to deliver a cumulative benefit.

"They were quietly upbeat about this product. They signed some blue chip partners for this," he said. Solvay SA, of Brussels, Belgium, was to have distributed the product in North and South America and in other international markets. CSL Ltd., of Melbourne, would have marketed it in Australia and New Zealand, while Paris-based Orphan Europe SARL had entered an agreement with Berna for Europe.

Sales estimates for Aerugen varied widely. Fortis estimated peak sales of around €100 million, whereas F. van Lanschot forecast peak sales of just €30 million worldwide.

"We were very conservative with this product," Hoppers said. "It is still a disappointment because it was one of the products Berna had in Phase III clinical trials," he said.

Crucell said the termination would have no effect on its guidance for 2006 or on its 2007 goal of reaching break even. The company previously forecast revenues between €130 million and €150 million for the current year.