Biotech Implosion: Novacea (NOVC, SGP)

Novacea, Inc. (NASDAQ:NOVC) has ended its Phase III ASCENT-2 clinical trial of Asentar(TM) (DN-101).  Unfortunately this is Novacea’s lead investigational cancer therapy for the treatment of patients with androgen-independent prostate cancer.

The trial halt is due to an imbalance of deaths between the two treatment arms, as observed by the Data Safety Monitoring Board for the clinical study.  Schering-Plough (NYSE:SGP) is Novacea’s partner on this candidate and both companies plan to fully analyze the clinical data resulting in higher death rates in the Asentar plus Taxotere treatment group.

The study was comparing the benefits of weekly Asentar plus Taxotere to the current standard of care in the treatment of androgen-independent prostate cancer. To date, more than 900 of the planned total of 1,200 patients were enrolled in this study at multiple centers in various countries, including the United States, Canada, Germany, and Central Europe.

If you look at Novacea’s pipeline, you’ll see that Asentar is the bulk of the efforts.  It’s going to be a long road ahead for the company.

Shares of Novacea (NOVC) are trading down 65% to $2.50 in pre-market activity.  Friday’s close was $7.19 and the prior 52-week trading range was $5.60 to $17.25.  Before the implosion, Novacea’s market cap was $169.19 million.  Biotechs blowing results are rarely good, but when its a Phase II or Phase III and it is your lead candidate it is as bad as one can imagine.

Jon C. Ogg
November 5, 2007