Intercell AG saw its share price plummet more than 40% to an almost five year low after it pulled the plug on its Travelers' Diarrhoea (TD) Vaccine Patch following a disappointing performance in late-stage trials.

The vaccine patch failed to meet efficacy targets in protecting against enterotoxigenic E. coli mediated diarrhoeal infections in pivotal, randomised and placebo-controlled Phase II and Phase III studies, prompting the company to cease its development programme.

The news obviously dismayed shareholders, particularly as Intercell said the projected year end loss for 2010 “will be substantially higher than the previously expected 40 million euros”, since milestone payments in connection with the program will now not be received from partner GlaxoSmithKline.

On the plus side, the firm said that the studies support continued work on its patch technology as a suitable route of immunisation for future potential vaccine candidates, as reproducible levels of protective antibodies following transcutaneous immunisation were induced.

Intercell said it is “extremely disappointed with these unexpected Phase II and III outcomes for [its] TD Vaccine Patch”, but was also quick to stress that the firm has “a clear strategy to further develop our strong product portfolio” - which includes “a series of promising vaccine and antibody pre-clinical candidates” - in a balanced way.