Medarex inc. (NASDAQ: MEDX) is seeing shares slapped in after-hours trading after the company is issuing disappointing news over the hopes for its Ipilimumab Pivotal Trials in patients with Advanced Metastatic Melanoma.  Its partner is Bristol-Myers Squibb (NYSE:BMY).

We have noted upon many occasions how the options trading in Medarx and Bristol-Myers was quite similar to that of former high-flyer Dendreon (NASDAQ:DNDN) that also ran into trouble after its pivotal prostate cancer trials failed to impress the FDA enough for an approval.  This was recently hit with a Sell rating.

The results from study 008 were conducted under Special Protocol Assessment and did not meet the primary endpoint, which was to rule out a best objective response rate of less than 10%.  However, the totality of data from the registrational program included a clear dose response effect observed in study 022 and best objective response rates across the three studies ranging from mid-single digits to mid-teens as determined by independent radiology review.

The objective responses were consistent with previous observations and included complete and partial responses.  The majority of the responses were ongoing at the end of the observation period.  Given the importance of these findings and the limited treatment options for this patient population, Medarex and Bristol-Myers Squibb are planning to meet with regulatory agencies in the near future.   Pending these discussions, the companies aim to submit a regulatory filing to the U.S. Food and Drug Administration (FDA) in the first half of 2008.

Medarex (NASDAQ: MEDX) shares are down 17% in after-hours at $11.00, and its prior 52-week trading range was $11.10 to $18.23.  Unfortunately, metastatic melanoma is still mostly untreated and this was the lead candidate for the company thought could yield a $1 Billion annual blockbuster drug status for it and Bristol-Myers.

Bristol-Myers Squibb (NYSE: BMY) closed up 0.2% today.

Here is the full release from Medarex.  The thing that is keeping Medarex from falling totally apart on this news is that the company actually has an extremely large pipeline with many other corporate partners aimed to treat many other diseases and conditions.

We routinely monitor such options open interest for unusual expectations for our open email distribution lists.

Jon C. Ogg
December 10, 2007

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.