Indianapolis-based Eli Lilly and Co. (NYSE: LLY) stock opens the day down after the company announced it is discontinuing development of a high-profile investigational medicine. Lilly shares dropped nearly 8 percent Monday on news of the announcement.
The drugmaker says it will not move forward with evacetrapib after results from a late-stage study suggested "insufficient efficacy."
The stock value drop totaled 6.7 points. The drug was a potential cardiovascular blockbuster for Lilly. Lilly Bio-Medicines President David Ricks says "we’re obviously disappointed in this outcome, as we hoped that evacetrapib would offer an advance in treatment for people with high-risk cardiovascular disease. We’ll be working with investigators to appropriately conclude these trials. We remain confident in our pipeline as we prepare for launches in other therapeutic areas with significant unmet needs."
The company says the development was halted during a Phase 3 trial, not for safety findings, but because an independent data monitoring committee suggested a "low probability the study would achieve its primary endpoint based on results to date."
Lilly Executive Vice President and Chief Financial Officer Derica Rice says "this unfortunate outcome for evacetrapib does not change our ability to generate long-term growth. Our recent string of positive data-readouts and our strong pipeline position us to grow revenue and expand margins through the remainder of this decade."
The company is set to release its third quarter earnings report next week and says the decision is expected to show up as an up to $90 million charge to research and development expenses.