Shares of BioDelivery Sciences International fell 24 percent Monday following the Raleigh company’s announcement of disappointing results from its Phase 3 clinical trial for its treatment Clonidine Topical Gel.
Clonidine is a treatment for painful diabetic neuropathy, a condition that afflicts some people suffering from diabetes.
BioDelivery reported Monday that, while encouraging, its results did not show a statistical significance for patients treated with Clonidine compared to a placebo.
“Based on the results of our previously announced positive interim analysis, this outcome was unexpected,” said Andrew Finn, BioDelivery’s executive vice president of product development, in a statement.
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The company said it plans to continue to develop Clonidine, and use these latest results to refine the protocol criteria for another trial.
“We believe the results of this trial continue to support that Clonidine Topical Gel is a potentially effective treatment for painful diabetic neuropathy and an important advance in treatment,” said Mark Sirgo, the company’s CEO, in a statement. “We encountered similar challenges in our early clinical development work with BEMA Buprenorphine for chronic pain and were ultimately successful in conducting two pivotal studies that met their endpoints. ”
Earlier this year the Food and Drug Administration accepted a new drug application for BEMA Buprenorphine, BioDelivery’s treatment for chronic pain. The treatment is being marketed under the name Belbuca. The FDA is expected to rule on the application in October.
In November, BioDelivery also launched Bunavail, its second approved medication, which is a treatment for opioid dependence.
In a research note, William Blair analyst Tim Lugo said he understands investors’ hesitation about BioDelivery spending the roughly $7 million required to conduct a second Phase 3 trial for Clonidine. But he maintains an outperform rating on the stock, with a target price of $25.
“Although the results are disappointing, we view today’s sell off as a significant buying opportunity, as we continue to believe Bunavail script trends will ramp up through the year and we view an approval of Belbuca in the fourth quarter as the next major catalyst for shares,” Lugo wrote.
BioDelivery shares closed Monday at $10.51, down $3.38. The stock is down 12.5 percent this year.