Targacept slashes staff by half in wake of PhIII disaster

Posted under AstraZeneca, Blog, Chutes and Ladders, Clinical Trials, Companies, depression, Diagnostics, Funding, Medical Devices, Medical Supply, Pharmaceuticals, Startups, Targacept, TC-5214, Universities, Videos by john

The late-stage collapse of Targacept's depression drug--TC-5214--will cost the jobs of close to half of the biotech's staffers, with 65 workers getting pink slips today. The news comes a month after Winston-Salem, NC-based Targacept ($TRGT) and AstraZeneca ($AZN), which had once committed to a $1.24 billion licensing pact on the drug, acknowledged that the treatment had failed the last two of four Phase III studies.

Once considered a bright prospect after upbeat Phase II results, 5214 today looks more like the kind of cautionary tale that has helped drive some of the biggest players out of the neurosciences arena. Depression studies are notoriously unreliable, often scuttled by high placebo responses. But investigators didn't even come close to the goal here: Hitting the primary endpoints in two out of four Phase III trials. The black eye at AstraZeneca, which could ill-afford another pipeline setback, has helped inspire a scramble to in-license other programs.

For Targacept, which had been adding staffers in expectations of a marketing launch, the writing was on the wall once the data hit. But company execs insist that with a cash cache of $220 million, Targacept still has a future.

"This painful step is part of an overall plan to align our resources more closely with nearer-term value creation opportunities," says Targacept CEO J. Donald deBethizy. "We remain well capitalized and focused on operating our business efficiently to ensure we are positioned to exploit our diverse clinical-stage pipeline to bring new medicines to patients." 

Among the departures will be CMO Geoffrey C. Dunbar. The trials chief is retiring at the end of this year.

- here's the press release

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Final PhIII results wipe out AstraZeneca, Targacept depression drug

Posted under AstraZeneca, Blog, Companies, depression, Diagnostics, Funding, Medical Devices, Medical Supply, neuroscience research, Pharmaceuticals, Phase III, Startups, Targacept, TC-5214, Universities, Videos by John Carroll

AstraZeneca ($AZN) and Targacept ($TRGT) made it official today that their partnered depression drug--TC-5214--proved a complete bust in Phase III. The last two of four late-stage studies failed to meet their primary endpoints, extinguishing any hopes for a comeback after the first two Phase III studies ended in failure. 

For AstraZeneca the clinical failures mark the disappointing end to yet another drug prospect for a deal to which it once committed up to $1.24 billion dollars. AZ--which has already signaled that it is winding down much of its neuroscience work in another round of layoffs--is left to face a chorus of critics who have castigated the pharma giant for its failure to assemble a promising late-stage pipeline. For Targacept, the failures put the biotech in a defensive crouch as top execs rallied behind a substantial wall of cash as they prepared for an inevitable reckoning.

"Since the readout from the first RENAISSANCE program outcomes, we have been carefully scrutinizing all aspects of our business to prepare for this contingency, and we will announce our plans by the end of April," said Targacept CEO J. Donald deBethizy in a prepared statement. "Targacept has built a deep and mechanistically diverse clinical pipeline, and, with multiple NNR Therapeutics in Phase II development in areas of large medical need and commercial opportunity and over $225 million in cash, we are well positioned for future success."

It's unlikely that many analysts were caught unawares by the failure. While it's not unusual to rack up a loss or two in late-stage depression studies, which can often be torpedoed by unusually high placebo responses, back-to-back failures left only dwindling hope for a turnaround. The failure of the study also marks another big setback for Targacept, which lost a major partnership with GlaxoSmithKline ($GSK) last year as that company led the exodus from the CNS arena.

- here's the press release

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Key AZ/Targacept depression drug flunks first Phase III test
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AstraZeneca buries one program as second drug stumbles again in PhIII

Posted under antidepressant, AstraZeneca, Blog, Companies, Diagnostics, Funding, Medical Devices, Medical Supply, olaparib, ovarian cancer, Pharmaceuticals, Startups, Targacept, TC-5214, Universities, Videos by John Carroll

AstraZeneca ($AZN) has back-to-back setbacks to report on a pair of key drug development programs. The pharma giant reported that it's burying the ovarian cancer drug program for olaparib after concluding that a mid-stage trial failure made it impossible for investigators to push ahead to the next stage. And investigators had more bad news to report to AstraZeneca and Targacept ($TRGT) about TC-5214, their partnered drug for depression. The treatment flunked its second of four Phase III trials, signaling some deep trouble for a treatment AstraZeneca promised to pay up to $1.24 billion for in their pact.

Those trial woes prompted AstraZeneca to add a $381.5 million impairment charge to its fourth quarter numbers, with $96.5 million of that representing the rapidly dwindling chance of success for the anti-depressant.

The trial failures mark another setback for the development execs at AstraZeneca, who have been struggling to overcome a lackluster record in the clinic. And it's another major blow to Targacept, which already had to deal with the departure of GlaxoSmithKline ($GSK) in the biggest biopharma deal breakup of 2011. Targacept's already battered shares fell 27% this morning.

"AstraZeneca seems to have had more than its fair share of misfortune when it comes to the development pipeline," Barclays Capital noted. "Additional development failures increase the probability that management will reassess the likely return on investment from additional R&D investment and cut costs further."

As in the first Phase III study, TC-5214 could not beat out a placebo in treating depression. Their target measure was a change in the Montgomery-Asberg Depression Rating Scale total score after eight weeks of treatment with TC-5214 as compared to placebo.

Back in 2009 olaparib, a PARP inhibitor, had been one of the stars of the ASCO show, as investigators unveiled significant tumor shrinkage. And the pharma giant isn't giving up on either program. Olaparib will be studied in other cancers while the TC-5214 treatment still has two other late-stage studies to complete.

- read the press release
- here's the Bloomberg report
- get the Dow Jones story

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