Mersana Therapeutics Inc. (NASDAQ: MRSN) shares took a massive dive on Thursday morning and were actually halted before markets opened. This came after the company announced that the U.S. Food and Drug Administration (FDA) put a partial hold on the firm’s early-stage cancer study.

Specifically, the FDA placed Mersana’s Phase 1 study of XMT-1522 on partial clinical hold. While the partial clinical hold remains in effect, no new patients will be enrolled in the study, though current study participants in its ongoing dose levels will continue to receive drug and otherwise participate in the trial consistent with its protocol.

The partial clinical hold was initiated following Mersana’s recent report to the FDA of a Grade 5 Serious Adverse Event (patient death) in dose level 7 of the XMT-1522 Phase 1 trial, which was classified by the investigator as possibly drug-related. Mersana will work closely with the FDA and the site investigators to review this event and to seek to resolve this clinical hold.

The partial clinical hold does not affect the ongoing clinical development of Mersana’s product candidate XMT-1536, currently in Phase 1 clinical trials for NaPi2b-expressing cancers.

Anna Protopapas, CEO of Mersana, said:

Patient safety is our utmost concern. Based on the totality of the data we have for XMT-1522, we believe that it continues to be a promising drug candidate in the solid tumor setting and we will be initiating the proper steps with the objective of resuming enrollment.

Shares of Mersana were last seen down more than 36% at $10.49, with a consensus analyst price target of $25.60 and a prior 52-week range of $12.45 to $23.96.

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