Prana Biotech Plunges as Drug Fails in Alzheimer’s Study

Mar 31, 2014 4:10 pm ET

(Updates with closing price in fifth paragraph.)

March 31 (Bloomberg) -- Prana Biotechnology Ltd. plunged the most ever in New York after the company’s experimental drug for Alzheimer’s disease failed to help patients in a trial.

The treatment, PBT2, didn’t show a statistically significant reduction in the levels of beta-amyloid plaques in the brains of people with mild Alzheimer’s, the Armadale, Australia-based company said in a statement today. PBT2 also led to no improvement in brain metabolic activity, cognition and function, Prana said.

“Whilst not meeting all of our hopes, this result does not deter us from the future development of PBT2, a safe and well- tolerated drug candidate for Alzheimer’s disease,” Chief Executive Officer Geoffrey Kempler said in the statement.

The failure adds to the list of once-promising experimental treatments for Alzheimer’s that have proven disappointing in clinical trials. Since 1998, there have been more than 100 unsuccessful attempts to develop a drug for the malady, which is the most common form of dementia. Worldwide about 35.6 million people have dementia, the World Health Organization estimated in 2012.

Prana’s American depositary receipts dropped 72 percent to $2.80 at 4 p.m. New York time, their biggest one-day drop since the ADRs began trading in 2002. The ADRs had tripled this year before today, valuing the company at $423.5 million.

PBT2 aims to prevent the accumulation of amyloid plaques, growths in the brain that are hallmark of Alzheimer’s, by interfering with metal ions that let them aggregate. The mid- stage study, dubbed Imagine, looked at 42 people with Alzheimer’s. PBT2 was given to 27 of them, and the other 15 received a placebo.