Shares in Alizyme are climbing back slowly after hitting an all-time low of £0.07 on the news that its ulcerative colitis agent Colal-Pred proved less effective than standard therapy.

Headline results from the firm’s 799-patient European Phase III clinical trial of Colal-Pred, which combines Alizyme's proprietary colonic drug delivery system Colal with the steroid prednisolone sodium metasulfobenzoate, revealed that the drug met its safety goal but missed its key efficacy goal of showing non-inferiority to conventional prednisolone.

Also Colal-Pred was "statistically superior to prednisolone in the proportion of patients who were treatment responders, ie were both efficacy and safety Responders, thereby meeting the key secondary endpoint", Alizyme said. Chief executive Tim McCarthy claimed that “the headline results of this study indicate that Colal-Pred is a safe steroid” and they also suggest that “this product has potential for maintenance of remission of ulcerative colitis”.

He added that the firm “will continue to analyse the results and, in conjunction with our partners and regulatory advisors, establish the optimum way forward in commercialising this product”. However his enthusiasm was not shared by investors and at the end of last week the shares sank almost 50% at one stage.

The news was particularly disappointing seeing as earlier this month, Alizyme announced a licensing deal for Colal-Pred worth a potential £33 million, though the upfront payment would be just £1.6 million, with Norgine to cover marketing in Europe, South Africa, Australia and New Zealand.

The stock is on the way back though, slowly but surely, as analysts pointed out that Alizyme still has the obesity drug cetilistat, which is to enter Phase III trials. However, the company has been searching for a licensing partner for cetilistat for over two year, which is causing investors some concern.