Shares in Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL) plunged sharply after the company announced that its late stage study of the drug fostamatinib, a therapy for the bleeding disorder known as chronic immune thrombocytopenia failed.
The stock fell 15.02% to close at $2.73 after trading 18.24 million shares.
The drug did not achieve a statistically significant difference from the placebo in the second of two trials, though the results of the first trial had been successful.
All is not lost, says Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL)
“We believe that the totality and consistency of data from the FIT Phase 3 program, which included two Phase 3 studies and one long-term extension study, strongly supports a clear treatment effect, with a sustained clinical benefit of fostamatinib,” said Raul Rodriguez, president and chief executive officer of Rigel. “We are encouraged by these results and believe that the risk/benefit ratio for fostamatinib is positive for patients with chronic/persistent ITP, a population with a serious unmet medical need. As a result, we will continue to pursue this opportunity. Our next step is to seek feedback from the FDA.”
Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL): Fostamatinib commercialization in limbo?
Last month Rigel took it for granted that the aforesaid trial would meet its endpoints, and therefore took advance action for the commercialization of fostamatinib. This included the reduction of its work force by 38%, mostly in the research area, preparatory to the creation of a commercial infrastructure “to support the potential launch of fostamatinib.”
“A smaller research department will continue Rigel’s mission to identify and develop novel small molecule therapeutics and will maintain active programs in immunology and oncology,” the company said. “This reduction and refocus is expected to provide approximately $17-20 million in savings annually going forward.”
Technically, a reference to the long-term, monthly chart of Rigel shows that the $2.00 level has been tested, and has held, a number of times. Investors may consider entering the stock around that level.