Verona Pharma plc (VRNA) stock plunged to an all-time low of $5.76 on Monday as its lead chronic inflammatory lung disease treating drug failed to show desired results in the phase 2 study. This is the first huge dip for the London-based biopharmaceutical company since IPO.
The company’s lead drug for treating chronic obstructive pulmonary disease (COPD) failed to meet the primary endpoint of a mid-stage clinical trial. COPD is a type of chronic inflammatory lung disease characterized by long-term breathing problems and poor airflow. The main symptoms include shortness of breath and cough with sputum production.
The results showed that the drug, ensifentrine, did not improve breathing by a majority amount despite being better than a placebo, which is a treatment of no intended therapeutic value. Verona chief Jan-Anders Karlsson said this data gave the company better clarity on the design, including dose background therapy, for future long-term studies.
The study showed the company that ensifentrine might benefit the more severe COPD patients on dual and triple therapy. This could be one of the few other treatment options available. The company has also planned to evaluate a metered-dose inhaler formulation in a phase 2 study assessing ensifentrine for the maintenance treatment of COPD.
Analysts expect Verona to post a loss of $0.51 per share for the fourth quarter. In comparison, during the previous year quarter, the company reported a loss of $0.55 per share. Meanwhile, investors have anticipated a wider loss in the fourth quarter due to the disappointing trial results. Analysts recommended a “buy” rating while expecting the stock to reach $33.80 in the next 52 weeks.
Shares of Verona Pharma ended Monday’s regular session down 30.30% at $6.97 on the Nasdaq. The stock has fallen over 44% in the past year and over 42% in the past three months.