By Randall Osborne

West Coast Editor

BioCryst Pharmaceuticals Inc. got more bad news about RWJ-270201, its neuraminidase inhibitor pill for influenza, from Johnson & Johnson (J&J), which said it will not be starting the North American Phase III study of the drug as planned.

Shares of BioCryst (NASDAQ:BCRX) dropped 34 percent Friday, closing at $6.50, down $3.433.

"It's one more delay we didn't, the first time, expect," said Randall Pittman, chief financial officer of Birmingham, Ala.-based BioCryst. "This time, it's the pivotal Phase III in the U.S."

The holdup, Pittman told BioWorld Today, is "not a deal killer. There's not a significant safety problem, or [Phase III trials] wouldn't be continuing in Europe."

Two months ago, when the company heard from J&J that two clinical trials of the flu drug in high-risk elderly patients would not start on time because of "logistical considerations," the firm's stock tumbled 53 percent, closing at $7.187. (See BioWorld Today, Oct. 13, 2000.)

Now, the entire North American study is being held up because the FDA has imposed more monitoring requirements that require amending protocol.

"We were hoping to get a leg up on it this season," Pittman said, but there is not enough time to enroll patients, because of the delay.

The drug, formerly known as BCX-1812, is BioCryst's lead product, licensed to the R.W. Johnson Pharmaceutical Research Institute (RWJPRI) and Ortho-McNeil Pharmaceutical Inc., which are both J&J companies.

After the first delay, BioCryst already said a new drug application was not expected until 2002, so the most recent delay may not have a significant effect on its entry into the flu-drug arena.

Already marketed flu products are Relenza, an inhaled neuraminidase inhibitor marketed by Glaxo Wellcome Inc., a U.S. subsidiary of London-based Glaxo Wellcome plc, and Tamiflu (oseltamivir phosphate, formerly GS4104), an oral neuraminidase inhibitor developed by Gilead Sciences Inc., of Foster City, Calif., and licensed to Hoffmann-La Roche Inc., of Nutley, N.J.

What happens next with BioCryst's flu compound is unclear, Pittman said.

"Nothing is for certain," he said. "It's very important to get a drug approved in the U.S. at some point, and that's what J&J wants to get done. At this point, we're continuing with development. We're still positive. We think it's a good drug."