MORRISVILLE – Shares in Triangle drug firm Novan plunged some 70 percent Thursday night after the company disclosed trial results for a treatment targeting a viral infection of the skin did not reach “statistical significance” for efficacy.
NOVN shares fell to 85 cents from $3.11 when the results about the drug candidate SB206 were announced after the markets had closed.
In the announcement, Novan also warned about the company’s financial future.
“Management, along with the Board of Directors, continues to explore both financial as well as strategic options in order to continue to progress SB206 for the molluscum indication,” Novan said.
“.As disclosed in the latest 10-Q filing, as of September 30, 2019, the Company had $22.5 million in total cash, cash equivalents and restricted cash, which is targeted to fund operations into the first quarter of 2020, excluding the effect of any potential sales of stock under the Company’s stock purchase agreement with Aspire Capital Fund, LLC (“Aspire”), if available. The Company is working to further address current operations with the aim of achieving a reduction in near term cash expenditures. Substantial additional funding will be required in order to continue to sustain business operations.”
The treatment is for molluscum contagiosum which the Mayo Clinic defines as “is a relatively common viral infection of the skin that results in round, firm, painless bumps ranging in size from a pinhead to a pencil eraser. If the bumps are scratched or injured, the infection can spread to surrounding skin.”
However, the company said that it still sees a “path forward” for the drug candidate called SB206, based on “multiple sensitivity analyses” of the two studies. It noted that the trials contine and the reported results “are for efficacy data only.”
Novan said it will continue to seek a New Drug Application from the FDA “subject to discussions” with the drug approval agency. A Phase 3 clinical trial is tentatively scheduled to begin in April.
Novan is a clinical development-stage biotechnology company focused on utilizing nitric oxide to treat a range of diseases