Drug makers AstraZeneca and North Carolina-based Targacept have abandoned plans to seek regulatory approval for a drug intended to treat major depressive disorder, the companies said Tuesday.
AstraZeneca said that the drug TC-5214 did not perform as hoped in an eight-week trial compared to a placebo. The announcement caused little surprise, following disappointing trials last year, but was a blow nevertheless for Targacept, the smaller of the two companies. Its shares dropped 14 percent in premarket trading in New York.
AstraZeneca, which said it will take an impairment charge of $50 million on the drug's failure, saw its shares fall only 1 percent to 2,830 pence in London.
TC-5214, which was not expected to be a blockbuster, was being tested as a supplementary treatment for major depressive disorder in patients who did not respond to the most common type of antidepressants, selective serotonin reuptake inhibitors. It was intended to work on neuronal nicotinic receptors, which regulate the nervous system.
Had the drug succeeded, sales would have been less than $100 million a year in 2016, according to analyst projections.
Dr. Mike Mitchell, health care expert at Seymour Pierce & Co., said the news underlined the difficulties of making progress in neuroscience.
"This is a tough field in which to develop new drugs, where current knowledge of the underlying biology of pathologies appears to be insufficient to generate reliable drug targets," Mitchell said.
Sanofi, GlaxoSmithKline, Merck, Novartis had cut back on research and development in the past two years, Mitchell noted. AstraZenecase earlier announced it was closing research labs in Canada and Sweden.
London-based AstraZeneca and Targacept Inc., based in Winston-Salem, North Carolina, signed a collaboration agreement to develop the drug in 2009.
J. Donald deBethizy, Targacept's president and chief executive officer, said the company had been reviewing its business to prepare for the possible failure of the drug, and had more than $225 million in cash to purse other avenues.