BioXcel shares plunge after issues at trial site for Alzheimer's-related drug

Raghav Mahobe and Sriparna Roy
Updated ·2 min read
FILE PHOTO: Evidence of Alzheimer’s disease on PET scans at the Center for Alzheimer Research and Treatment in Boston

By Raghav Mahobe and Sriparna Roy

(Reuters) - BioXcel Therapeutics flagged issues related to the recording of safety data at a site for a late-stage trial of its drug to treat agitation in Alzheimer's patients, sending its shares down to a more than three-year low on Thursday.

The company said the principal investigator, who enrolled 40% of the study participants at that site, was found to have fabricated email correspondence related to timing of the filing of a serious side-effect with the company's vendor responsible for monitoring safety of the drug.

This was initially observed by the U.S. Food and Drug Administration (FDA) after an inspection of the site in December after which the company started an investigation.

BioXcel CEO Vimal Mehta said it was more of a documentation issue and not a fabrication of side-effects.

The company is in the process of hiring an independent auditing group and internal audit results may be available in as early as two or three months, BioXcel's management said on a conference call with analysts.

The company added that it doesn't see a scenario where it is not able to submit the entire data from the trial for the drug's approval. The trial dosed 149 patients with mild to moderate dementia.

BioXcel plans to submit an application seeking expanded use of the drug, named BXCL501, to the FDA in the second half of this year.

Truist Securities analyst Robyn Karnauskas, however, said she had "high confidence in data integrity and approval" of the drug. Karnauskas estimates $1 billion in annual sales for the drug.

BioXcel separately said on Thursday the drug met the main goal in the trial and showed statistically significant reduction in acute agitation after two hours compared with 5.4 hours for patients receiving placebo.

The drug is already approved by the FDA for treating agitation associated with schizophrenia or bipolar I or II disorder in adults.

BioXcel shares were down more than 58% at $7.38.

(Reporting by Khushi Mandowara, Raghav Mahobe and Sriparna Roy in Bengaluru; Editing by Krishna Chandra Eluri and Shailesh Kuber)