Michelle SladeAssociate Editor

Gensia Pharmaceuticals Inc.'s stock plunged 41 percent in thepast two days as the company announced that data from PhaseIII international clinical trials on Arasine, its lead drug, inpatients undergoing coronary artery bypass surgery were not"statistically significant."

The value of shares in the San Diego company (NASDAQ:GNSA)dropped $13.50 on Tuesday to close at $22, as almost 7 millionshares were traded. Gensia's 52-week high reached $47 ashare.

Units of Aramed Inc. of San Diego, a Gensia spinoff(NASDAQ:ARAMZ), tumbled $17.50 a share in the past two days,closing at $23.50 a share on Tuesday.

Arasine, a drug designed to prevent cardiovascularcomplications, failed to achieve significant end points in thetrials, Gensia spokeswoman Martha Hough said.

The two end points were a reduction in the incidence ofmyocardial infarction and in adverse cardiovascular outcomes,including cardiac death, acute myocardial infarctions, stroke,severe arrhythmias and congestive heart failure.

Hough said, however, that statistically significant reductionswere observed in two subgroups in the international study: in ahigh-risk group consisting of 40 percent of all patients and inpatients in Canadian trials. Gensia said it will continue toanalyze aspects of the study that may have affected it. Thecompany said U.S. Phase III clinicals did produce appropriatelysignificant data.

Hough said Gensia still plans to make a regulatory submissionto the FDA and file a new drug approval (NDA) application forArasine in both the U.S. and Europe by the end of the year.

Gensia plans another multicenter study at several U.S. andinternational sites to gather additional data to supportArasine for use in coronary artery bypass surgery. Hough saidthe company expects to have results by the end of 1993.

Additional trials will likely delay Arasine's introduction bothin the U.S. and in Europe, but some analysts think the marketoverreacted.

Alex. Brown & Sons Inc. analyst Amy Berler told BioWorld thatthe steep drop in Gensia's stock price is an indication that themarket is skittish, and she said she still has faith in thecompany and the drug.

The market, she said, has given enourmous credence toambiguous European data and very little credence to the drug'sperformance in U.S. trials. She said, however, that marketingapproval may be delayed in Europe, which she said comprisesabout 20 percent of the worldwide market for Arasine, and thecompany may have to make the drug's indication more narrowthere.

Analyst Richard Stover of Stover Haley Noyes in Stamford,Conn., agreed that the selloff was "grossly overdone." "Peoplehave lost sight of the fact that Gensia has succeeded inachieving efficacy in the U.S. for a condition for which no otherdrug has been found beneficial," he said.

Hough said Phase III trials with Arasine in non-cardiac surgery"will be delayed for up to six months due to the fact that wewill be putting a high priority on the new Arasine trial andwill need to divert (human) resources."

(c) 1997 American Health Consultants. All rights reserved.