Horizon Pharma shares dropped 20 percent after the company pulled the plug a late-stage trial testing Actimmune as a potential therapy Friedreich's ataxia.

Friedreich's ataxia (FA) a rare inherited disease that causes progressive damage to the nervous system, causing unsteady movements and impaired sensory functions. It can also lead to scoliosis, heart disease and diabetes.

The Phase III trial STEADFAST failed to meet its primary endpoint of showing a statistically significant change from baseline in the modified Friedreich's Ataxia Rating Scale (FARS‐mNeuro) at 26 weeks in patients taking the drug versus those in the placebo arm.

Secondary endpoints also failed to reach statistical significance, the Dublin, Ireland-headquartered firm said, signalling the end of the development programme for the Actimmune (interferon gamma-1b) in this setting.

"While the results were not what we hoped for, this is the very reason why research and development is important - to find answers that may help inform future research," noted Timothy Walbert, Horizon's chairman, president and chief executive.

Actimmune is a biologically manufactured protein approved in the US to treat chronic granulomatous disease and severe, malignant osteoporosis.

The firm said its failure in FA will not impact its full-year 2016 adjusted net sales or adjusted EBITDA guidance.