Prana Biotechnology Limited (ADR) (NASDAQ:PRAN) Falls On Fears
As with other small capped development stage bio tech firms, Australia based Prana Biotechnology Limited (ADR) (NASDAQ:PRAN) too is heavily vulnerable to analyst and trade guru commentary on the prospects of the development stage drugs which firms are attempting to bring to the market.
Sumner Street Expresses Doubts On Efficacy Being Proved
This was amply demonstrated during yesterday’s trading, when share price of Prana Biotechnology Limited (ADR)(NASDAQ:PRAN) went down by 16 percent during trading on 7th February and 10th February. This sell off in the stock was triggered by news that analyst Bart Classen of Sumner Street had disclosed in a letter to his clients that he was not overtly impressed by the preliminary data released by the drug maker about its ongoing clinical trials for drugs designed to treat “Alzheimer’s and Huntington’s” ailments
Data Points Not Conclusive
The analyst while conceding that the results from the 12 week long clinical tests did indicate improvements in certain aspects of the critical neuropsychological tests, goes on to underline that these results are not significantly strong enough data wise to help move the candidate drugs into the next phase of testing. He also draws attention to the need to adjust the limited nature of the positive findings against the vagaries of the clinical trial procedure of using multiple end points to note down the end result before determining the effectiveness of the data being published. Considering these draw backs in the procedure laid out and the lack of incisive and conclusive data points, Mr Classen had opined that the drug maker would struggle to prove effectively the efficacy of their drug in treating diseases like Alzheimer.
Investors React To The Analyst Warning
On the back of this analyst report getting significant traction among the investor community, a major run on the stock of this development stage drug maker became unavoidable over the past two trading sessions. At current price points, the stock is trading 31 percent below its 52 week high price bench mark of $13.29 per share.