By Frances Bishopp
Shares of AutoImmune Inc., which dropped 67 percent in April when Myloral failed in clinical trials for multiple sclerosis, fell to a new low Friday at $2.125 after another drug, Colloral, did not demonstrate statistical significance vs. placebo in Phase II trials for rheumatoid arthritis.
The company reduced its staff by 31 percent in May following the Myloral trial setback and will cut the number of employees once again, from 50 to approximately 20, over the next several months.
AutoImmune's stock (NASDAQ:AIMM) plummeted $9.25 to $4.50 April 22 when the Myloral trial results were disclosed. Friday the shares ended the day up slightly at $2.187.
Robert Bishop, president and CEO of AutoImmune, of Lexington, Mass., said preliminary data from a third Phase II active control trial of Colloral are expected this summer.
Both Myloral and Colloral are oral tolerance drugs, which are based on the body's ability to take in foreign proteins and not trigger a broad immune attack against those proteins. In very selective doses, the proteins are processed in the gut and trigger production of regulatory T cells, which then move through the body to suppress the autoimmune attack believed to be responsible for multiple sclerosis and rheumatoid arthritis.
"What we saw in the clinical trials recently completed," Bishop said, "were statistically significant differences from baseline, but not from placebo. We had very high placebo responses."
He added, "We have reduced the size of the company to a core group that is capable of conducting clinical trials. The primary task in front of us is to find an appropriate clinical trial design that will allow us to be approved by the FDA. We don't see any issues that would be difficult for us outside of the clinical issues."
Bishop said the company plans a one-time restructuring charge of approximately $2.7 million the current quarter. The restructuring will be completed by the end of the third quarter, resulting in a reduction of new quarterly spending to approximately $1.5 million, plus the cost of any new clinical trials.
As of March 31, 1997, AutoImmune had cash on hand of approximately $43.4 million. *