Things just keep getting worse for Ariad Pharmaceuticals Inc. (NASDAQ: ARIA). In fact, a series of shareholder revolts are probably in the works here after yet another massive drop on news that it is halting sales of its cancer drug.
Ariad announced on Thursday that the company is temporarily suspending the marketing and commercial distribution of its drug Iclusig in the United States. This is the company’s treatment for patients with resistant or intolerant chronic myeloid leukemia and Philadelphia-chromosome positive acute lymphoblastic leukemia.
The company said that it continues to negotiate updates to the U.S. prescribing information for Iclusig and implementation of a risk mitigation strategy. Investors certainly are upset that this suspension was in response to a request by the U.S. Food and Drug Administration (FDA) on Wednesday afternoon.
Now it seems fair to ask exactly how “temporary” this suspension will really be. Ariad said in its confessional press release that it believes that Iclusig is an important medicine for patients with resistant or intolerant Philadelphia-positive leukemias. It also conveyed that the company is actively working with the FDA to allow the resumption of its marketing of Iclusig.
Ariad’s history is a checkered one. Most shareholders who bought in at much higher prices would say that this is a massive understatement.
Sales were less than $1 million in 2012, down from $25.3 million in 2011 and down from almost $179 million in 2010. March was the first quarter with real sales again, at almost $6.5 million. Then the sales hit $14.1 million in the June quarter. Thomson Reuters was forecasting that sales would be almost $16.7 million in the September quarter and $21.25 million in the December quarter. Sales also were expected to double in 2014 to $121.3 million.
Suspensions of this magnitude often move from temporary to intermittent. They obviously can have a severe impact on sales and doctor reception for years in the future.
If a drop of almost 40% to $2.42 sounds bad, just imagine how bad this is when you consider that the 52-week trading range is $2.27 (hit Thursday) to $24.59. Things went to hell in a handbasket over the past month, and now it is fair to reiterate that this is an implosion candidate.
Already more than 20 million shares changed hands in just the first 15 minutes of trading on Thursday.
Is Your Money Earning the Best Possible Rate? (Sponsor)
Let’s face it: If your money is just sitting in a checking account, you’re losing value every single day. With most checking accounts offering little to no interest, the cash you worked so hard to save is gradually being eroded by inflation.
However, by moving that money into a high-yield savings account, you can put your cash to work, growing steadily with little to no effort on your part. In just a few clicks, you can set up a high-yield savings account and start earning interest immediately.
There are plenty of reputable banks and online platforms that offer competitive rates, and many of them come with zero fees and no minimum balance requirements. Click here to see if you’re earning the best possible rate on your money!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
