Prana Shares Plunge on Alzheimer’s Disease Drug Trial

Shares of Prana Biotechnology (PRAN) are getting shellacked in premarket trading on Monday following the results of a mid-stage clinical trial of experimental drug PBT2 for Alzheimer’s disease failing to meet its primary endpoint of reducing plaques in the brain.

The Melbourne, Australia-based company reported top line results from its 12-month, Phase 2 trial, dubbed “IMAGINE,” showing that levels of beta-amyloid plaques in the brains of prodromal/mild Alzheimer’s disease patients did not undergo a statistically significant change between treatment and placebo groups. Buildup of these plaques are considered hallmarks in the pathogenesis of Alzheimer’s. Further, no improvement was observed on the secondary endpoints of brain metabolic activity, cognition and function.

On the positive side, Prana noted that the drug was shown to be safe and well tolerated, with 40 of the 42 patients enrolled completing the trial. Additionally, the data showed trends towards preserving hippocampal brain volume in patients treated with PBT2. Patients receiving the new drug candidate demonstrated up to 4.0-percent less brain atrophy, a loss of brain matter than precedes clinical symptoms of Alzheimer’s, than those receiving a placebo.

Prana said it is not giving up on PBT2 for Alzheimer’s, noting that the biomarker was different in this trial that the previous study, called “EURO.” In that trial, Prana measured levels of unaggregated soluble Abeta peptides in spinal fluid, which showed a significant reduction in PBT2-treated patients. In the IMAGINE trial, the company used PiB-PET scans, a brain imaging technique for studying beta-amyloid plaques in neuronal tissue.

“It is possible the result may point to PBT2 targeting soluble species of Abeta including toxic oligomers rather than plaques. Abeta oligomers are not visible in the PiB-PET scans, which can only detect amyloid plaques. Alternatively, what we are seeing is simply the result of an inconclusive imaging readout in a small sample size with 42 participants (15 on Placebo, 27 on PBT2),” Geoffrey Kempler, chief executive of Prana, said in a prepared statement this morning.

"Whilst not meeting all of our hopes, this result does not deter us from the future development of PBT2, a safe and well tolerated drug candidate for Alzheimer's disease,” Kempler added.

Shares of PRAN have been swelling in value in the past year, rising more than 350 percent from lows last summer through Friday’s closing price of $9.86. The stock got a big bump in February when a Phase 2 trial of PBT2 for Huntington disease met its primary safety endpoint and achieved statistically significant improvement in cognitive function.

Those gains have been erased in premarket trading, with the stock price nosediving as much as 76 percent to as low as $2.35.