- Intra-Cellular Therapies plummeted more than 60% in early trading Thursday after the company announced Wednesday evening its schizophrenia drug failed to perform better than a placebo in a late-stage study.
- Neither dose of ITI-007 was able to best a placebo in the primary endpoint of the study, measured as a change in baseline on the Positive and Negative Syndrome Scale (PANSS) total score. Meanwhile, Risperdal (risperidone) was used as an active control and showed better results than placebo.
- Shares of Intra-Cellular fell more than $26 to trade near just below $16 Thursday morning, below the company's IPO price of $17.50 in January 2014. The price is well below the biotech's 52-week high of $59.96.
"We believe ITI-007 did not separate from placebo on the pre-specified primary endpoint in Study ‘302 in part due to an unusually high placebo response at certain sites which disproportionately affected the trial results and contributed to the efficacy outcome of this study compared to our two previous positive efficacy studies," said the company in a statement.
Yet, that argument is a hard one to swallow for investors, particularly in light of patients in the Risperdal arm performing better than the placebo patients. Risperdal is an already low-cost generic that is now available in several different forms, including a long-acting shot developed by Johnson & Johnson under the brand name Risperdal Consta.
"It is not uncommon in the field of psychiatry for studies to be challenged by high placebo response and there has been great variability in the effects observed from one study to the next. In one of these studies, ITI-007 and risperidone, the active control, had similar efficacy," argued Christoph Corell, Professor of Psychiatry at Hofstra Northwell School of Medicine in a statement.
The company says it has adequate funding to continue to pursue the development ITI-007 in schizophrenia and plans to speak with the U.S. Food and Drug Administration's Division of Psychiatry Products to find a regulatory path forward.