Biohaven Pharmaceutical Holding said its migraine treatment met the main goals in two late-stage studies but the efficacy data failed to differentiate when compared with rival treatments in a crowded field.
Shares fell as much as 50 percent in light premarket trading on Monday but pared losses to trade down 23 percent at $19 as volume picked up.
The stakes are high for Connecticut-based Biohaven, which entered a competitive field late and hopes to rival a treatment from Allergan Plc that reported strong efficacy data in February.
While the efficacy in one of Biohaven studies looked in line with Allergan’s, William Blair analysts said the other study appears to be affected by a higher placebo rate by a few percentage points.
The drug’s effectiveness was disappointing especially in the light of a threat from Allergan, Morgan Stanley analyst Matthew Harrison said in a client note.
Harrison, however, said the drug, rimegepant, achieved an approvable profile with safety markedly better than competitors.
The treatment is part of a new class of medicines called CGRP receptor antagonists that experts say could do well in the market.