NEW YORK (AP) -- Shares of Zalicus tumbled to an all-time low Monday after the company said it is ending development of its most advanced experimental drug.
THE SPARK: The pain drug developer said drug candidate Z160 failed in two mid-stage clinical trials. One trial evaluated the drug as a treatment for post herpetic neuralgia, or nerve pain that follows shingles, a viral infection related to chicken pox. The other involved patients with lumbosacral radiculopathy, a condition that causes pain in the lower back.
Zalicus said it will focus on its pain treatment Z944, its only other drug in clinical testing.
THE BIG PICTURE: Zalicus Inc. does not have any approved products of its own, but it receives royalty payments on sales of Mallinckrodt PLC's Exalgo. Exalgo was approved in 2010 as a treatment for moderate-to-severe chronic pain, and Mallinkcrodt reported about $31 million in revenue in its latest fiscal year.
Zalicus, of Cambridge, Mass., reported a loss of $10.5 million on $3.4 million in revenue in the third quarter. It had $1.5 million in royalty revenue and $1.9 million in revenue from drug discovery services.
SHARE ACTION: Zalicus shares plunged $3.39, or 72.3 percent, to $1.30 in midday trading. Earlier the stock hit an all-time low of $1.15.