Shares in Denmark’s Lundbeck have taken a battering after the company, along with partners Paion of Germany and the USA’s Forest Laboratories announced disappointing late-stage data for the new stroke drug desmoteplase.

Data presented at the European Stroke Conference in Glasgow, Scotland revealed that the Phase III DIAS-2 study of desmoteplase in acute ischemic stroke failed to indicate any difference versus placebo. The primary efficacy endpoint of the 186-patient study was clinical improvement at day 90 but while 47.4% treated with 90mcg desmoteplase and 36.4% on 125mcg of the drug responded well, so did a lofty 46% in the placebo group.

Four deaths were reported in the placebo group compared with 17 among those taking desmoteplase, three receiving the lower dose of the drug and 14 receiving the 125mcg dose within the 90-day follow-up period. However, ten of those 14 “were considered by the investigators as not related to the drug, nine of which occurred 14 or more days after stroke and were from non-neurological causes," the companies said.

The firms stated that “these data are surprising and are not consistent with previously observed patterns” in other stroke trials, adding that “the absence of consistency with previous findings is not easy to explain, but in-depth analyses are planned to better understand the data”. In a conference call afterwards, Paion's chief executive Wolfgang Soehngen said he was disappointed but claimed that “desmoteplase didn't fail, placebo was just by chance better than usual".

Lundbeck said it will await the outcome of the detailed analysis before deciding if it will proceed with a second Phase III trial of desmoteplase. Investors seem to think that further development may not happen and the stock ended down 8% on Friday night on the Copenhagen Stock Exchange.

The news represents yet another clinical setback for Lundbeck which announced in March that it was discontinuing development of its insomnia drug gaboxadol, which was partnered with Merck & Co. The desmoteplase disappointment prompted Dresdner Kleinwort to reiterate its ‘reduce’ rating on the firm in a research note and the analysts said Lundbeck’s late-stage pipeline is looking far too slim. They added that the company remains greatly exposed to the weak US dollar and the patent expiry of the antidepressant Lexapro (escitalopram) in 2012, and suggested that the firm’s management should start to seek merger partners.