Boston, MA 10/16/2013 (wallstreetpr) – Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA) drug Iclusig is proving the some treatments are worse than the cure. Billed as a possible cure in the treatment of a rare form of blood cancer, the drug has so many severe side effects that the U.S. Food and Drug Administration (USFDA) have asked doctors and patients to report all adverse reactions. The drug was undergoing extensive clinical trials and the company was expecting results that would have made it the frontline treatment in patients suffering from blood cancer. Iclusig was granted orphan drug status – this would have protected the drug from competition for seven years. Ariad had also partially commercialized the drug and had reported revenues of $14 million last quarter from sales of Iclusig as compared with $0.32 million in the same quarter last year. The company was so confident about Iclsug, that it was not developing any other molecule. And that was its single biggest mistake, a mistake that may well sink the company.
The USFDA found that the drug causes blood clots and liver toxicity and advised patients and doctors accordingly besides putting on temporary hold all new trials. The company also announced that after two years of clinical trails, it had found that 11.8% of the patients developed blood clots, 6.2% suffered cardiovascular problems, and 4% and 3.6% had brain and peripheral vascular issues respectively. Apart from these issues, 20% also experienced various types of vein and artery blockages. The drug was giving severe adverse reactions and the treatment was giving rise to many complications requiring emergency surgical treatment.
Ariad had not diversified its product portfolio; it was expecting that the treatment would be approved for more indications. Such tall claims in the past had ensured a good share price but the revelations are now posing legal issues. Many legal companies are in the process of suing the company on behalf of shareholders. Investors should take this as a wakeup call while investing in a single product biotech company. Good results are not guaranteed but a failure can sink the company.
