What happened
Actions of Arcturus Therapeutics Holdings (NASDAQ: ARCT) were down 53.7% as of 11:16 am EST on Tuesday. The huge decline came after biotechnology reported data from an early-stage clinical trial of the candidate vaccine COVID-19 ARCT-021.
And
Investors had high hopes that a single dose of ARCT-021 could be highly effective in preventing the coronavirus infection that causes COVID-19. But Arcturus’ latest results threw cold water on those expectations.
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Arcturus reported that its vaccine produced neutralizing antibodies after just one dose. But the levels of neutralizing antibodies were lower than those produced by Pfizer‘sand Moderntwo doses of COVID-19.
Steven Seedhouse, an analyst at Raymond James, said in a note to customers of the company that the effectiveness of ARCT-021 with a single dose can be as low as 62%. It is a disappointing level compared to the 95% effectiveness of Pfizer and 94% of Moderna.
It is possible that a two-dose regimen of ARCT-021 is much more effective. But that would not give Arcturus a competitive advantage over rivals, as would a highly effective single dose vaccine. There is also at least the possibility that other clinical studies show that a single dose of ARCT-021 is more effective than initial results seem to indicate. For now, however, much of the excitement about Arcturus’ prospects has understandably waned.
What now
Arcturus received approval from regulators in Singapore to advance ARCT-021 for a phase 2 clinical study. The company expects to report the interim results of this study in early 2021 and start a global phase 3 study in the second quarter of next year. The biotechnology stock is unlikely to have any significant chance of recovering, unless the results of these studies are much better than the initial stage data.