Targacept shares have plummeted after the firm's experimental overactive bladder candidate failed to hit targets in a mid-stage trial.

The group's stock was down nearly 30% in mid-day trading reflecting investor disappointment that TC-5214 has reached the end of the line, having failed to produce a statistically significant improvement in urinary incontinence in a Phase IIb trial.

“Although TC-5214 provided dose-dependent efficacy on several endpoints during the course of treatment, the results were not compelling enough to justify the compound’s continued development in overactive bladder,” said Stephen Hill, Targacept’s President and chief executive. 

The news is a particularly big blow for the firm because earlier this month it was also forced to pull the plug on its Alzheimer's disease candidate, shedding a huge question mark over its focus on the modulation of nicotinic receptors to treat a variety of conditions.

“Assessing these results together with our previous clinical trial outcomes, including data from our most recent trials in schizophrenia and Alzheimer’s disease, it is clear that modulation of nicotinic receptors can result in biological effects. However, these effects do not appear to predict new treatments with a meaningful improvement over the current standard of care for the indications studied," Dr Hill said.

Targacept noted that, over the coming months, it will continue to carefully evaluate the portfolio options it believes have the potential to "make a significant difference in patients’ lives and provide meaningful upside for our stakeholders".