Immutep Ltd (NASDAQ: IMMP) (ASX: IMM) (OTCMKTS: PRRUF) (FRA: YP1B) investors confronted their worst nightmare on Friday the 13th as the Australian biotech firm’s shares plunged in a stunning crash. Shares tumbled by 89 per cent in a single session, wiping out most of the company’s US$411 million market value and forcing the stock into penny territory.
The Independent Data Monitoring Committee reviewed interim safety and efficacy data from the Aussie biotech’s Phase III “TACTI-004” trial and recommended immediate discontinuation citing futility.
Immutep executives accepted the verdict without hesitation and halted enrolment in the 756-patient study across more than 25 countries.
CEO Marc Voigt voiced sharp disappointment and genuine surprise. He pointed to eftilagimod alfa’s (efti) strong prior results in head and neck cancer, where it delivered a median survival of 17.6 months and high response rates when paired with Merck & Co Inc‘s (NYSE: MRK) (ETR: 6MK) Keytruda.
Eftilagimod alfa is essentially a lab-made protein that tricks the immune system into fighting cancer harder. It’s injected under the skin (subcutaneous), and usually given every couple of weeks alongside Merck’s drug.
Analysts echoed the shock and the drop was crushing for investors. Firms such as Jefferies Financial Group Inc (NYSE: JEF), Baird, and Citizens quickly downgraded the stock, slashed price targets and stripped projected revenues tied to non-small cell lung cancer.
Hedge fund Regal Partners Ltd (ASX: RPL) (FRA: OC7), which holds roughly 14 per cent of Immutep, absorbed a 5.2 per cent hit to its own fund. Moreover, Dr Reddy’s Laboratories Ltd (NYSE: RDY) (FRA: RDDA) shares slid more than 2 per cent after the news because of a licensing partnership they have for the product.
Despite the major setback, Immutep leaders are optimistic about their firm’s long-term outlook. The company launched a full data review to map out its next steps.
Immutep is now redirecting resources to a robust pipeline where efti continues to advance with Fast Track designations in head and neck squamous cell carcinoma, breast cancer and soft tissue sarcoma.
Read more: Breath Diagnostics advances pre-op pneumonia screening with FDA breakthrough designation
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