From a $2 billion valuation to less than $300 million in five months, Chimerix (CMRX) (of Josh Hardy fame) is a standout among biotech stocks, for the wrong reason. While the markets have not been kind to the sector in general, CMRX has lost 90% of its value over the last five months compared to 35% for the NASDAQ Biotech Index Fund. The stock dropped another 35% Monday after the company made the case that brincidofovir, which failed a late-stage study last year, still has potential.
Chimerix presented new data over the weekend from the failed SUPPRESS trial of brincidofovir, the company’s drug candidate for cytomegalovirus (CMV) infection in patients receiving hematopoietic cell transplant. The 450-patient SUPPRESS study failed to meet its primary endpoint – the rate of CMV infection 24 weeks after transplant, compared to placebo – last December. Chimerix fell 80% with that announcement.
Over the weekend, the company presented new, re-hashed results from the SUPRESS study, suggesting that patients on brincidofovir benefited more than those receiving a placebo, and that failure to follow study protocol might be the culprit behind the disappointment in December. Essentially, doctors may have mis-diagnosed and mis-treated patients in the study who presented with diarrhea, a known side effect of brincidofovir but also a symptom of Graft-vs-Host-Disease. Chimerix believes that corticosteroids, given to treat GVHD, may have contributed to the drug’s failure. Study protocol called for interruption of the drug if diarrhea presented, and the median cumulative exposure to corticosteroids was 8-fold higher in subjects on brincivofodir than those on placebo. Steroids, not drug ineffectiveness, might be to blame for brincidofovir’s inability to reduce the risk of infection at 24 weeks.
The capital markets don’t see this good news – from a scientific standpoint, at least – the same way. While the post-hoc analysis might hold water, it likely means that Chimerix needs to run another sizable study – perhaps two – to prove that out. That’s more money spent and a longer timeline to potential approval. And, post-hoc analyses have a way of disappointing later.
Rather than send Chimerix higher on scientific progress, investors punished the stock further; the 35% drop Monday takes Chimerix well below its cash value. The company ended the year with just under $350 million in cash and equivalents. On Monday, the company’s market capitalization stood at $230 million.
The company plans to discuss the latest findings with the FDA before deciding on a path forward in HCT.
This article was originally published at Forbes.com.
