Keryx Biopharmaceuticals, Inc. (NASDAQ: KERX) may have just joined the ranks of a biotech zombie, even if it doesn’t want to admit that. The company announced that top-line results from its SUN-MICRO Phase III clinical trial of Sulonex for the treatment of diabetic nephropathy have failed to meet the primary objective of the study. Unfortunately, this was Keryx’s lead product candidate.
The study was aimed to achieve therapeutic success at 6-months as compared to placebo. The results showed that Sulonex and the placebo appeared to be similar. Interestingly enough, the company lost its CFO last summer.
It will focus efforts and resources on rapidly moving Zerenex forward for ESRD patients with hyperphosphatemia and Perifosine for cancer. It listed its goal of having Perifosine in a pivotal program this year and to be well into its Zerenex high-dose Phase II trial before the end of the year.
Keryx notes that while this is the end of one chapter, it is not the end of Keryx as it noted that it has built up a portfolio of potential product candidates. Wall Street isn’t taking that at face value. With the SUN-MICRO name, you’d think that disappointment there could have been expected.
At the end of 2007 it had $62 million in cash and equivalents with another $2.296 million in long-term investments. It also had $36.6 million in total liabilities. Its market cap before today’s implosion was $230 million. We don’t have to wonder for too long about how much capital it will have to burn through for these two other phase studies.
Keryx closed at $5.26 on Friday and its prior range over the last year had been $5.01 to $11.70. Shares are trading down over 80% at $0.80 in pre-market activity.
Jon C. Ogg
March 10, 2008