Biotech Values

[DewDiligence]

Here’s a different view on whether AZN will stay
the course. FWIW, I don’t see how the experience
with Exanta has much to do with what AZN does
with AGI-1067.

http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20070328:MTFH01589_2...

>>
Astra Likely to Drop Atherogenics Drug—Analysts

Wed Mar 28, 2007 11:07 AM ET
By Ben Hirschler

LONDON, March 28 (Reuters) - AstraZeneca Plc <AZN> is likely to drop development of AtheroGenics Inc's <AGIX> experimental heart drug following unconvincing clinical trial results, industry analysts said on Wednesday.

AtheroGenics, whose stock fell 60 percent earlier this month when headline results of the study were released, lost a further 12 percent in early trade on Nasdaq on Wednesday, while AstraZeneca shed 1.5 percent, hitting a fresh three-month low.

Data presented at the American College of Cardiology scientific meeting in New Orleans on Tuesday confirmed the drug missed the primary goal of a pivotal late-stage trial but did cut death, heart attack and stroke, and dramatically reduced the risk patients would develop diabetes.

Graham Perry of Merrill Lynch said in a note that despite some positive signals the drawbacks of the medicine would likely deter AstraZeneca from proceeding with development.

Key problems included the need for further trials and a worrying signal of potential liver toxicity, which AstraZeneca will be particularly sensitive to, given its history with Exanta -- an anti-coagulant that failed because of a liver issue in 2004.

AstraZeneca has agreed to pay up to $1 billion for exclusive rights to AGI-1067, in a bid to bolster its depleted new drug pipeline. But the London-based drugmaker can still opt out of the deal.

An AstraZeneca spokeswoman said on Tuesday it was working through the statistical analysis of the study and would then use a 45-day contractual period to decide whether to continue with the compound.

Gbola Amusa of Sanford Bernstein said the liver signal seen in clinical tests suggested one in 5,000 patients on AGI-1067 could suffer serious or fatal liver problems. That is twice the rate seen for Rezulin, a diabetes drug which was pulled from the market in 2000, he noted.

Analysts at Bear Stearns also said they assumed AstraZeneca would hand back rights to AGI-1067, while ABN AMRO downgraded the Anglo-Swedish drugmaker's stock to "sell" from "hold".
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