Transition Therapeutics, Inc. (TTHI)

[Camaro1093]

Roth Capital downgrades TTHI to Hold from Buy and lowers their tgt to $6 from $13. The firm notes TTHI's ELN005 is currently in a Phase 2 clinical study to treat Alzheimer's. However, after meeting with the Independent Safety Monitoring Committee the firm announced thsi morning that it was discontinuing dosing at the 2 highest dose levels of this study, 1 and 2 g. This decision was made based on an excess of serious adverse events in these treatment group, including 9 deaths. There was also a death in either the low dose or placebo group. The first Phase 1 studies did not demonstrate any toxicity, though the doses in this study were not disclosed. While ELND005 may still be a viable drug, and the firm hopes that it succeeds, the imbalance in deaths and potential that the current Phase 2 study may not be able to afford a statistically significant result is a great concern. Based on today's data, the firm now thinks that odds of ELND005 reaching the market in 2014 are 15% down from 25%.