NEW YORK (AP) -- Targacept Inc. shares fell Monday after the company said an experimental attention deficit hyperactivity drug failed in a mid-stage clinical trial and announced plans to eliminate more jobs.
THE SPARK: Targacept said patients who were given with a placebo had greater improvements on a clinical rating scale than patients treated withTC-5619. The company said it is ending studies of TC-5619 as a treatment for ADHD. The company also said it will eliminate an unspecified number of jobs, and won't make investments in new neuronal nicotinic receptor drug candidates until it hires a permanent CEO.
THE BIG PICTURE: Targacept is developing drugs that target neuronal nicotine receptors, a group of proteins in the nervous system that modulate the levels of key chemical messengers, such as dopamine, that are linked to nicotine's addictive effects. The company has reported several failed clinical trials in 2012. In March the company said it was ending development of a drug called TC-5214 as a treatment for depression, and it reported mixed results for a drug designated TC-6987, saying it did not work as a treatment for diabetes and met one out of two study goals as a treatment for asthma.
In April the Winston-Salem, N.C., company said it would eliminate 65 jobs, or almost half its workforce, and two months later Targacept said J. Donald deBethizy, its president and CEO for about 12 years, had left the company. It has not yet named a replacement.
SHARE ACTION: Shares of Targacept lost 60 cents, or 12.4 percent, to $4.25 in afternoon trading. The stock closed at $19.12 before Targacept and AstraZeneca reported the first results from a late-stage trial of TC-5214 as a treatment for depression.