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What: Shares of Ariad Pharmaceuticals, , a biopharmaceutical company focused on developing cancer therapies, plunged as much as 43% -- its third plunge of 42% or more in October -- after announcing that the Food and Drug Administration requested it temporarily suspend sales of its blood cancer drug Iclusig.
So what: According to Ariad's press release, the FDA informed Ariad of its request to temporarily suspend sales of Iclusig -- a treatment for resistant or intolerant chronic myeloid leukemia and Philadelphia chromosome-positive acute lymphoblastic leukemia -- yesterday, and that it plans to work with the FDA to potentially relabel Iclusig to get it back on the market. This temporary sales suspension relates to Ariad's findings, announced three weeks ago, that 11.8% of patients on Iclusig experienced blood clots in their arteries in a two-year follow-up study compared to just 8% at the 11-month mark.
Now what: To be honest, the only shocking aspect I see is how the share price isn't down even more! Although the suspension is only labeled as "temporary" in Ariad's press release, and Iclusig could very well make it back to market, I struggle to see how Iclusig's potential toxicity is going to make it a marketable pipeline option. With seven of its eight clinical trials still involving Iclusig, Ariad would almost need to start from scratch. Plus, even if Iclusig makes it back to pharmacy shelves what doctor is going to prescribe, or patient be willing to take, Iclusig following Ariad's two-year follow-up study? There are a lot of unanswered questions here. Thankfully, Ariad still has nearly $342 million in cash on hand, so we'll be around to get those answers... eventually.
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The article Why Ariad Pharmaceuticals Inc. Shares Hit the Deck originally appeared on Fool.com.Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong . Try any of our Foolish newsletter services free for 30 days . We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
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