Call it a double whammy for Immunovant. The clinical-stage biotech hit another roadblock with its lead drug candidate, IMVT-1401, just as Chief Medical Officer Rita Jain makes an abrupt exit after five months with the company.
The sudden cholesterol increases that cropped up in IMVT-1401's thyroid eye disease trial in February—triggering a temporary halt in the clinic—actually extend beyond thyroid-related disease, the company said Tuesday, sending shares down 38% to $9.40.
RELATED: Immunovant hits the pause button for eye drug after unexpected cholesterol spike
The LDL spikes appeared in multiple studies, Immunovant said after reviewing the data. Albumin levels, rather than thyroid hormone levels, apparently drove the LDL increases, the company said.
"This was our bear case scenario," Derek Archila, Stifel senior biotechnology analyst, said in his note after the news.
IMVT-1401 is one of several anti-neonatal Fc receptor (FcRn) antibodies in biopharma pipelines, all in development for auto-immune diseases. J&J, UCB, Argenx and Alexion are among the list. Stifel no longer believes Immunovant's drug will be a major player in the field.
Immunovant is not giving up, however. The company will discuss with regulatory agencies how to move forward, eyeing late 2021 or early 2022 to restart clinical development. If regulators approve, the company plans to begin two additional studies in the next 12 months.
“Following a program-wide data review, we remain confident in our plan to develop IMVT-1401 across a broad range of autoimmune indications,” said CEO Pete Salzmann, M.D., in a statement.
But Immunovant is moving forward with a lower dose, which Archila said there is little data to support.
The plan to resume clinical development appears to be the non-public information that convinced majority owner Roivant Sciences to disclose it would pay a premium to reacquire the share of the company it doesn't already own. Roivant kept 57.5% of the company when it spun off Immunovant via a SPAC merger in December 2019.
With no other news looming, “the only thing buoying the stock price is likely to be a potential acquisition offer by Roivant, which may or may not come,” Archila said in his note.
RELATED: Roivant, in an unexSPACted twist, wants to bring Immunovant back into the fold
But first, Roivant Sciences would have to tie up loose ends in its own go-public deal with special purpose acquisition company Montes Archimedes Acquisition.
And meanwhile, Immunovant will have to bear the brunt of these setbacks with a new chief medical officer at the helm.
As part of today’s financial results for fiscal 2021, Immunovant said Rita Jain, M.D., is leaving “to pursue another opportunity,” without divulging more. Jain joined the company in January. William Macias, M.D., Ph.D., will step into Jain’s shoes after serving as a member of senior management at Eli Lilly.