Anacor shares sink after release of study results

The Associated Press
Associated Press

Shares of Anacor Pharmaceuticals Inc. plunged Tuesday after the drug developer said its potential nail fungus treatment did better than a placebo in a late stage study, but an analyst said it fared poorly compared to a rival's product.

THE SPARK: Anacor, based in Palo Alto, Calif., said early results from the first of two late-stage studies showed that 6.5 percent of patients taking its experimental drug tavaborole achieved a complete cure of the fungal infection. That compares to less than 1 percent of patients treated with a placebo. Patients in the study applied the solution to their nail once a day for 48 weeks.

Anacor said the treatment met all the main and secondary goals of the study with a high degree of statistical significance.

The company expects to release data from its second trial in March and apply for approval of the drug by the middle of the year.

THE BIG PICTURE: Last November, Valeant Pharmaceuticals International Inc. announced results from late-stage studies of its potential nail fungus treatment, efinaconazole. The Canadian drugmaker said nearly 18 percent of the patients treated with efinaconazole achieved a complete cure in one study, and more than 15 percent achieved it in another.

Valeant submitted its treatment to the Food and Drug Administration for approval and expects to hear back by the end of May, a spokeswoman said.

THE ANALYSIS: Anacor's tavaborole met its main goal but fell short of expectations of Cowen analyst Eric Schmidt, as well as Valeant's results, he said in a research note.

But Wedbush Securities analyst Gregory Wade said it's clear the Anacor drug was tested on a patient population that had a wider age range and, generally, more advanced cases of the nail fungus.

"We're pretty encouraged, we definitely think they have a product," he said.

An Anacor representative did not immediately return a call from The Associated Press seeking comment.

SHARE ACTION: Down 22 percent, or $1.12 to $4.05 in Tuesday afternoon trading. The stock bottomed at $3.83 earlier in the session, its lowest price since going public in November, 2010, at $5 per share.