Neurogen Corp.'s stock fell 23 percent Tuesday after the company said its Alzheimer's drug partnered with Pfizer Inc. failed to show a therapeutic effect in a Phase II study.
Neurogen's stock (NASDAQ:NRGN) closed Tuesday at $4.81, down $1.44, while Pfizer's (NYSE:PFE) closed at $33.5, up 43 cents.
The news surrounds development of NGD 97-1 (Pfizer No. CP457,920), a compound designed to selectively reduce the activity of the neurotransmitter gamma-aminobutyric acid (GABA) in the memory centers of the brain, which was shown to improve cognitive function in preclinical animal models, a prepared statement from Branford, Conn.-based Neurogen said.
However, in a double-blind, Phase II study in 200 patients, the compound did not work. Alzheimer's patients received one of three doses of the drug, placebo or control drug.
"Overall, we are certainly disappointed that the results came out negative, but the way we've constructed our business plan, we are taking multiple shots on a goal, which means we are cognizant of the attrition rates in this industry," William Koster, Neurogen's president and CEO, told BioWorld Today.
Before speaking with BioWorld, Koster held a third-quarter earnings conference call with analysts and investors, at which time he said the company has $83.9 million in cash - enough to last the through early 2005, if the company doesn't enter any additional collaborations. Neurogen had a $7.8 million net loss for the third quarter, and a $19.2 million net loss for the first nine months ended Sept. 30. The net loss was $20.2 million for the same nine months in 2001.
Regarding NGD 97-1, Koster said the Neurogen-Pfizer partnership will drop the compound, as it dropped 91-3 for neuropsychiatric disorders when it failed to meet Phase IIa endpoints late last year. (See BioWorld Today, Dec. 21, 2001.)
Nevertheless, the decade-old collaboration with Pfizer marches on. Since signing the deal in 1992, Pfizer has paid Neurogen $58 million on GABA-based drug candidates. (See BioWorld Today, June 19, 1999; Nov. 6, 1998; Dec. 11, 1997; and Feb. 10, 1992.)
Steve Davis, Neurogen's chief business officer and executive vice president, explained that the collaboration effort had three focuses: Alzheimer's, anxiety and insomnia.
Since the first two have dropped out, the new focus will be insomnia, or a drug referred to as 96-3. Davis said Phase I data from 96-3 are expected in the first half of 2003.
On another positive note, Neurogen said Phase I studies of NGD 2000-1, an orally administered C5a receptor antagonist for the treatment of inflammatory disorders, showed that the product was safe and well tolerated.
While the product is not currently partnered, Koster said several companies have expressed an interest.
By the end of the year, he expects patient enrollment to begin in an exploratory rheumatoid arthritis study, which will examine the ability of NGD 2000-1 to lower levels of C-reactive protein, an RA biomarker.