Shares in Alkermes dropped more than 30% in the aftermath of news that its experimental depression drug failed to hit targets in two late-stage studies.

ALKS 5461 is a once-daily, oral investigational medicine with a novel mechanism of action being developed for the adjunctive treatment of major depressive disorder (MDD) in patients who have an inadequate response to standard therapies.

But the drug has hit a major setback after failing to induce a significant change in baseline on the Montgomery-Åsberg Depression Rating Scale (MADRS), a ten-point diagnostic questionnaire used to measure the severity of depressive episodes in patients with mood disorders, compared to placebo.

However, the company believes it may still have a path forward for ALKS 5461, as data from the Phase III FORWARD-4 study did show a clear trend toward efficacy with the 2mg/2mg dose, and post hoc analyses achieved statistical significance for the entire 2mg/2mg dose group on the MADRS endpoint.

The FORWARD-3 trial tested ALKS 5461 (2mg/2mg) versus to placebo in 429 patients and found no treatment effect, though the placebo response was found to be greater than that observed in FORWARD-4. “Negative trials due to significant placebo effect are not uncommon in the study of major depressive disorder,” the firm noted.

The third pivotal study, FORWARD-5, is ongoing, testing two dose levels of ALKS 5461 (2mg/2mg and 1mg/1mg). Based on data from FORWARD-3 and FORWARD-4, patient enrollment in the trial will now be increased and the statistical analysis plan updated, Alkermes said.

If the data is positive, taken together with findings from a Phase II trial and that from FORWARD-4 could provide substantial evidence of efficacy for ALKS 5461 for the adjunctive treatment of MDD, the firm noted.

“Clinical trials of new medicines for the treatment of major depressive disorder are complicated by significant placebo response. We designed the FORWARD pivotal program to include three efficacy studies as we recognise that this is a challenging disease state where multiple clinical studies and expansive analyses are generally necessary to confirm the efficacy of a new medicine,” said Elliot Ehrich, the group’s chief medical officer.