Flex Pharma Inc (NASDAQ: FLKS) is having an incredibly rough start to the trading session this morning, and for good reason. The company announced that it is ending ongoing Phase 2 clinical trial investigations. Of course, the news upset investors, sending the stock tumbling downward. Today, we’ll talk about:
- The ended clinical trial investigations;
- what we’re seeing form the stock as a result; and
- what we’ll be watching for with regard to FLKS ahead.
FLKS Sinks On Clincial Update
As mentioned above, Flex Pharma is having an incredibly rough start to the trading session this morning after announcing that it is ending its Phase 2 clinical trial. In a press release issued ealry this morning, the company announced that it is ending both Phase 2 clinical trial investigations of FLX-787 in amyotrophic lateral sclerosis (ALS) and Charcot-Marie-Tooth (CMT). In the release, FLKS said that it is ending these trials due to oral tolerability concerns observed in both studies. In a statement, Bill McVicar, Ph.D., President and CEO of FLKS, had the following to offer:
In the past few months we have reported positive efficacy data in two serious and distinctly different neurological diseases: multiple sclerosis (MS) and ALS. We believe that these clinical data demonstrate the clear potential of FLX-787 as a symptomatic therapy to reduce painful cramps and spasms in these patient populations… However, recent observations of oral intolerability at the current dose and formulation, in a subset of patients, in both studies, indicate that more formulation and dose-ranging studies are required, which is challenging for the Company based upon our current resources.
Along with the announcement the company said that it is working on its best path forward in an effort to preserve shareholder value. Moving forward, it will be focusing its resources on assessing strategic alternatives, which would include the potential sale or merger of the company. In the release, the comapny said that a Strategic Committee has been formed and will work with management to oversee the process.
The company will be operating with a reduced internal team and will be assessing the potential of FLX-787 in dysphagia and operating the HOTSHOT consumer business while the review is ongoing.
What We’re Seeing From The Stock
With the news that Flex Pharma is scrapping both clinical studies, investors are overwhelmingly concerned, leading to massive declines in the value of the stock. Of course, our partners at Trade Ideas were the first to alert us to the declines. Currently (9:44), FLKS is tradinga t $1.44 per share after a loss of $2.74 per share or 65.67% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, teh CNA Finance team will continue to keep a close eye on FLKS. In particular, we’re interested in following the story surrounding the company’s work with regard to FLX-787 following today’s rejection. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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