Tuesday January 19, 11:37 am Eastern Time
Monsanto falls after drug studies stopped
CHICAGO, Jan 19 (Reuters) - Shares of life sciences company Monsanto Co. fell again Tuesday after the company's Searle pharmaceutical unit killed studies on two once-promising cardiovascular drugs and raised warning flags with investors.
Tuesday's drop, on top of Friday's after-market declines, leaves shares of Monsanto down nearly 10 percent. The drugs had been in development for 10 years but Searle said data suggested the drugs did not significantly reduce deaths, heart attacks and other heart problems.
Credit Suisse First Boston analyst Jay Hickman said Searle's so-called ''fiban'' drugs -- orbofiban and xemilofiban -- are certainly now dead. He estimated the potential market for the anticlotting drugs at $500 million to $1 billion, placing them just behind Searle's potential blockbuster arthritis drug Celebrex which recently won approval from the Food and Drug Administration.
''It was one of their more promising areas in the pipeline after Celebrex,'' Hickman said.
The promise of the ''fibans'' was to prevent formation of bloodclots in patients with heart disease, an area analysts called high-risk for drug manufacturers. Some indications of trouble arose in November, when Searle stopped taking new patients for the orbofiban clinical trail.
Schroder & Co. analyst Jami Rubin said the failure of the drugs presents a credibility problem with management at Monsanto. ''A number of investors were anticipating another wave of drugs. This wave is certainly dead.'' It is too soon to tell if some cancer compounds in development will pan out, she said, leaving Monsanto with a high-risk profile.
Shares of St. Louis-based Monsanto were down 50 cents to $38.50 after closing at $42.00 Friday on the New York Stock Exchange. |
