Idera Pharmaceuticals Inc (NASDAQ:IDRA) shares sunk following the release of disappointing Phase 2 trial results.
The biopharma’s drug IMO-8400 is intended to be a treatment for dermatomyositis, a chronic inflammatory disease that causes a skin rash and muscle weakness. However, the drug failed to meet its primary endpoint in its Phase 2 trial when there was no statistically significant change from the baseline versus the placebo.
That sent shares nearly 10% lower in morning trading, to US$1.74.
In a double-blind, placebo-controlled trial, 30 patients received either an injection of the drug or a placebo for up to 24 weeks. In more than half of the subjects, 17 out of the 30, the disease was still in the severe range.
The company did not give information concerning the next steps for IMO-8400.
Baird lowers price target
R.W. Baird analysts noted the disappointment of the Phase 2 trial but says focus should be placed on the biopharma’s upcoming merger with BioCryst. Shareholders will vote on the matter July 10.
The analysts maintained the Outperform rating but lowered its price target to US$4 from US$5.
Despite the latest trial results, the analysts see promise in Idera’s lead immune-cology asset. IMO-2125, a treatment for melanoma, will be moving forward in a Phase 3 study.
“We currently view the IMO-2125 opportunity as undervalued and believe there is a strong likelihood of success for the Phase 3 study,” wrote the analysts in a note.