NEW YORK (AP) — Shares of Allergan Inc. skidded Wednesday and Regeneron Pharmaceuticals Inc. shares climbed after Allergan announced a delay in the development of an eye drug that could compete with Regeneron's product Eylea.
THE SPARK: Allergan reported its first-quarter results on Wednesday. During a conference call with investors, the company announced a setback for a drug it calls DARP-in. Allergan said the results from a mid-stage clinical trial of the drug did not justify immediately moving the drug into late-stage testing. Instead, Allergan will run additional mid-stage trials to get more data on effectiveness and safety and refine the design of future late-stage studies.
Chairman and CEO David Pyott said the changes "will likely delay eventual approval by approximately one to two years compared to starting a Phase III program by the end of 2013," as Allergan had originally planned.
The trial compares DARP-in to Lucentis as a treatment for wet, age-related macular degeneration, the leading cause of blindness among the elderly.
THE BIG PICTURE: Regeneron received marketing approval for Eylea in late 2011. In 2012 the drug received a second approval as a treatment for another eye condition called central retinal vein occlusion. Regeneron posted $838 million in total sales of the drug in 2012, or about 60 percent of its total revenue.
Regeneron expects to report $1.2 billion to $1.3 billion in sales in 2013. The Tarrytown, N. Y., company is scheduled to report its first-quarter results on Thursday.
Lucentis is marketed by Swiss drugmaker Roche. Eylea is less expensive and can be administered with fewer injections.
Allergan said the additional studies of DARP-in don't affect its profit or sales forecasts because the drug is years away from reaching the market.
SHARE ACTION: Shares of Allergan fell $14.50, or 12.8 percent, to $99.05 in late trading. As of Tuesday's close, Allergan shares were up 23.8 percent in 2013. The stock set an all-time high of $116.45 on April 11.
Regeneron's stock advanced $23.50, or 11 percent, to $238.64 and reached an all-time high of $252.35. The shares have nearly quadrupled in value since the start of 2012.