By Frances Bishopp

Cortech Inc.'s stock plummeted 32 percent on the news that its partner, SmithKline Beecham plc, had discontinued development of Bradycor, a bradykinin antagonist, in the treatment of traumatic brain injury, after Phase II clinical trials demonstrated the drug had no significant effect on intracranial pressure.

The trial enrolled 133 patients at 31 centers in North America and was conducted by London-based SmithKline under the terms of an agreement announced in November 1995.

The results were disappointing, and unexpected, based on other study results, Kenneth Lynn, president and CEO of Cortech, told BioWorld Today.

Cortech's stock (NASDAQ:CRTQ) dropped from $1.343 to $0.906, down $0.437. Cortech's lead product, Bradycor is designed to block receptors to bradykin, which has been shown to produce pain and to initiate inflammatory responses and swelling.

Cortech's stock dropped 63 percent in July 1994, when the Denver company's first trial of Bradycor for sepsis failed to show a reduction in 28-day mortality.

In October, Cortech initiated a higher-dose, longer-duration study of Bradycor for the same indication. At the same time, Cortech obtained results from a single-blind study done in South Africa for traumatic head injury. "We had an ongoing sense of the trend, which was very encouraging," Lynn said. "Bradycor was successful in demonstrating with statistical significance beneficial effect with respect to all three endpoints: elevated intracranial pressure, neurological function, and as a need for surgery as an intervention for relief of intracranial pressure."

The stock fell 59 percent in July 1995 on the news that Phase II data showed Bradycor was unable to extend survival in a subgroup with Gram-negative infections. In this study, mortality was higher among the Bradycor treatment group than the placebo group and Cortech discontinued all development of the drug, which included halting a second Phase II trial for traumatic brain injury. A subsequent analysis of the sepsis study showed the deaths were not related to Bradycor.

At that time, Lynn said Cortech already was in discussion with SmithKline about a Bradycor collaboration. In November 1995, SmithKline agreed to pay up to $25 million for rights to continue development of the bradykin antagonist for other indications, such as traumatic brain injury and ischemic stroke.

Concurrent with the completion of this agreement, Cortech completed a company restructure.

In October 1996, Cortech said, as a precautionary measure, SmithKline suspended a Phase II trial of Bradycor after a pharmacokinetic study of the drug in rats resulted in deaths of the animals. After more studies, Cortech said the animal mortality rate appeared to have been related to problems in mixing the drug solution or administering it in the experiments at the outside research facility.

Bradycor was not associated with any adverse reactions among participants of the Phase II trial for reduction of brain swelling caused by head trauma.

Other than Bradycor, Cortech has two other products in the clinic: CE-1037, a parenteral elastase inhibitor, for acute respiratory distress syndrome, and CP-0597, a more potent, second-generation bradykinin antagonist.

In December 1996, a Phase II pilot study of CE-1037 was suspended after partner Hoechst Marion Roussel, of Frankfurt, Germany, said safety concerns with the drug surfaced in recent animal studies. Hoechst Marion Roussel, which owns just under 10 percent of Cortech, ended its collaboration with the company at that time and returned the rights to CE-1037.

"It's virtually unimaginable that Cortech would resume development of CE-1037," Lynn said, "without a corporate partner stepping in and supporting that development.

"It is not the case that the Bradycor results necessarily have negative implications for carrying forth with CP-0597," he said. "But it certainly doesn't have positive implications. In these circumstances, I think we will continue to carry through with some small, relatively inexpensive continued evaluation of CP-0597, to put finishing touches on a partnering package, but I wouldn't expect to see us invest significantly in carrying it forward."

"There have been a succession of disappointments that have not left us with a lot of wind in our sails," Lynn said.

Cortech, Lynn said, will continue its internal research efforts for the discovery and preclinical development of orally available inhibitors of human neutrophil elastase, a tissue-destructive enzyme. Ono Pharmaceutical Co. Ltd., of Osaka, Japan, has funded much of this work under a 1995 agreement between the companies.

"Although it is early research, we have had very encouraging progress in that program," Lynn said.

Cortech, as of March 24, 1997, has cash reserves of approximately $21 million. The burn rate for last year was approximately $2 million. *