Heat Biologics stock fell more than 50 percent in Thursday morning trading after the drug developer announced that its bladder cancer drug did not produce favorable results in a Phase 2 trial.

The stock was trading at $1.27, down $1.60, or 55.7 percent, as of 10 a.m.

The company said it will continue to monitor all patients enrolled in the study for an additional 12 months and will make a final determination whether to progress its bladder cancer program into a Phase 3 trial.

Urothelial carcinoma is the most common type of bladder cancer. About 430,000 people worldwide were diagnosed with bladder cancer in 2012, and 165,000 died from the disease, according to New Jersey-based pharmaceutical company Merck & Co.

Merck & Co., which also makes cancer-fighting drugs, has a manufacturing plant in Durham and a facility in Wilson, North Carolina. The company’s study of its Keytruda drug in patients with previously treated bladder cancer found that the drug was superior compared to standard chemotherapy in the final-stage trial of 542 patients, Merck said in a statement on Oct. 21.

Merck’s drug is one of several, including Bristol-Myers Squibb Co.’s Opdivo, that harness the patient’s own immune system to fight hard-to-treat cancers, and it’s already approved to treat cancers in the lung, head, neck and skin.

The Merck drug would go up against Roche Holding AG’s Tecentriq, which was approved in May for patients with advanced bladder cancer. Merck has a market capitalization of $165.8 billion, whileHeat Biologics’ market capitalization stands at $68.5 million.

Heat Biologics reported a net loss for the third quarter of $1.7 million, or 8 cents per share, beating Wall Street expectations of a loss of 16 cents per share, as the company cut its expenses, N.C. Business News Wire reported on Nov. 11. The Durham-based company credited the decrease to reductions in consultant fees, clinical trial costs and workers.

Founded in 2008, the company has a negative 8.31 percent one-year return. Its share price has a 52-week range of 40 cents to $4.71 per share. Shares closed at $2.98 Wednesday.

In October, Heat Biologics announced a new collaboration with the University of Miami for the license and development of a portfolio of patents to target infectious diseases. The company’s wholly-owned subsidiary Zolovax Inc. will work on developing vaccines for the treatment of Zika, HIV, West Nile, dengue and yellow fever.

There have been more than 18,000 cases of Zika in the U.S. and its territories. Congress hasn’t allocated any funding to fight the disease, Bloomberg reported on Sept. 15.

Note: This story is from the North Carolina Business News Wire, a service of UNC-Chapel Hill’s School of Media and Journalism