More than three quarters of the value in Prana Biotechnology (PBT) stock has disintegrated this morning after the dual-listed company announced its phase 2b trial failed to reduce the symptoms of Alzheimer’s disease.
Shares in the once-loved biotech have plunged 77% to 24 cents at 1100 AEDT – following a similar response in the US overnight – in response to the news.
Some of Australia’s wealthiest families have been caught up in the share price plunge with both the Smorgon and Lieberman families well-known stakeholders in the company.
Prana said that its drug PBT2 did not reach its primary endpoint to show a statistically significant reduction in the levels of beta-amyloid plaques in the brains of Alzheimer’s disease patients. Though the treatment did show an overall reduction, the company said there was also an “atypical reduction” from the placebo patients as well.
“Whilst not meeting our hopes, the result does not deter us from the future development of PBT2,” chief executive Geoffrey Kempler said.
The shocking share price reaction will hit a number of ‘rich list’ familes:The Smorgon family, worth about $2.64 billion, hold around one million shares in Prana, while the Liberman family (worth $2.1 billion) owns a private company that holds a 3.72% stake.
Prior to today, Prana had been one of the exceptional biotech stories: the stock had soared around 460% in the past year.