BioWorld International Correspondent

SYDNEY, Australia - The share price of Amrad Ltd. fell sharply last week after the company revealed that Serono SA abandoned development of one of its lead compounds.

Investors cut Melbourne-based Amrad's share price by A$0.22 to A$0.67 when the company said Serono had informed it that trials of its leukemia inhibitory factor infertility compound, called emfilermin, had failed. On Monday, the share price fell further to A$0.63.

Amrad CEO Pete Smith said Serono has informed the company that the treatment failed to make women pregnant, after a number of cycles of assisted reproductive therapy.

"The study did not demonstrate statistical proof of efficacy comparing emfilermin to placebo in terms of clinical pregnancy rate, the primary endpoint of the study," he said.

Smith also said that the study did not reveal any major safety issues and that the data will be reviewed to understand the difference between the latest trial and the exploratory study results reported last year. But as the results stand, the company is "highly unlikely" to develop emfilermin for any other application.

"We are disappointed by this result, given that we believed emfilermin for reproductive health could have been a major product for Amrad," he said.

In a statement, Smith pointed to Amrad's other key programs, including an asthma partnership with Merck & Co. Inc. that has generated $11 million in the past 12 months; the GM-CSFR project that it is developing in collaboration with Cambridge Antibody Technology Group plc; and the VEGF-B projects that may have applications in rheumatoid arthritis and cancer.

When Amrad signed the deal with Serono in 2000, the Swiss company was reported as promising to pay $16 million plus royalties if the drug was successful.

Emfilermin is not the first treatment promoted by Amrad that showed sufficient promise in early trials to be taken up by a major pharmaceutical company, only to be later abandoned.

In 1992 GlaxoSmithKline plc and DevoCo Pharmaceuticals Ltd. separately decided to abandon development work on Amrad compounds, and the company also announced negative Phase II results for emfilermin as a treatment for reducing nerve damage during chemotherapy. That string of announcements and a plunging share price resulted in a board shakeup, including the appointment of a new chairman.