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news.Following the poor clinical performance of Nastech Pharmaceutical's experimental nasal obesity treatment, the company has lost the backing of drug giant Merck and Co, resulting in a massive drop in Nastech's share price.
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Nastech’s stock fell by 37% following the end of its partnership with Merck. The companies had been collaborating on the development of nasal spray, PYY3-36 (PYY), for the treatment of obesity. However, the agreement has now been terminated with effect from March 1, 2006.
Based on a preliminary proof of concept study, Merck concluded the intra-nasal formulation of PYY did not demonstrate efficacy. However, following a review of the data, Nastech said it believed the formulation was capable of delivering the drug into the bloodstream via nasal administration and would continue to study the compound.
“Based on our review, Nastech believes that clinical trial results to date support the continued development of this important investigational product for the treatment of obesity, and we remain committed to the further advancement of the PYY clinical program this year,” stated Dr Steven Quay chairman, president and CEO of Nastech.
Following Merck’s decision, Nastech shares fell $8.59 to $14.43 on the Nasdaq.