(Updates share price in fifth paragraph.)
Dec. 5 (Bloomberg) -- Eli Lilly & Co. will end development of the depression medicine edivoxetine as an add-on therapy after the drug failed to meet goals in three studies.
A current trial evaluating the experimental compound’s long-term effects will continue, the Indianapolis-based company said in a statement today. Edivoxetine was in the final of three stages of testing usually required for marketing approval by U.S. regulators.
The end of edivoxetine as a potential add-on therapy is another research setback for Lilly, which has had a cancer treatment, ramucirumab, fail in breast cancer patients, and an experimental compound prove unsuccessful in helping people with advanced Alzheimer’s disease. Lilly has cut costs and put resources into diabetes therapies as the company prepares for a revenue decline next year when it loses patent protection on antidepressant drug Cymbalta and osteoporosis medicine Evista.
Today’s decision will result in a pretax charge of $15 million, or 1 cent a share, in the fourth quarter, Lilly said. The company reaffirmed its 2013 forecasts and said it still plans to return to revenue growth in 2015.
Lilly rose less than 1 percent to $49.96 at 4 p.m. New York time. The stock has gained less than 1 percent over the last 12 months, compared with a 27 percent increase in the Standard & Poor’s 500 Pharmaceuticals Index.
Edivoxetine had been expected to generate $560 million by 2020, said Seamus Fernandez, an analyst with Leerink Swann & Co. who has an outperform rating on the stock. Sales at that level would have made the drug Lilly’s 10th-biggest product last year.
--Editors: Bruce Rule, Angela Zimm