Novus Therapeutics Plummets After Disappointing Drug Trial Results

Shares of Novus Therapeutics were on a downward spiral on Monday, losing almost half of their value after the specialty drug maker announced disappointing trial results of its ear infection treatment OP0201.

Novus revealaed that a phase 2a trial of OP0201 in acute otitis media did not achieve statistical significance in achieving its primary targets for results. The company said, however, it was encouraged by the statistical trend that favored the OP0201 treatment group with regard to middle ear effusion.

“Although we did not achieve statistical significance for the primary efficacy endpoints, we are encouraged with the statistical trend that favored the OP0201 treatment group with regard to resolution of middle ear effusion,” said Dr. Catherine Turkel, President and Head of Global R&D for Novus Therapeutics. “Middle ear effusion is a key diagnostic criterion for otitis media disorders, including acute otitis media. When middle ear effusion persists after an episode of acute otitis media, it may make children susceptible to more serious otitis media disorders, such as recurrent acute otitis media and/or chronic otitis media with effusion. These topline results, including evidence supporting the safety and tolerability in infants and children, support continued development of our surfactant-based nasal aerosol. We are grateful to the young patients, their parents/caregivers, and the investigators who supported this clinical trial,” concluded Dr. Turkel.

The company also announced that it has starting exploring options to maximize shareholder value, including engaging Ladenburg Thalmann as financial advisor. The options could include a financing to continue developing its surfactant-based nasal aerosol, a sale of the company or assets, or other deals.
“We recognize that continued development of our surfactant-based nasal aerosol will require significant time and capital,” said Gregory J. Flesher, CEO of Novus Therapeutics, Inc. “We must fund the company for several years in order to complete additional formulation and device development, initiate the next otitis media clinical trial, and ultimately deliver clinical data. Given our current valuation relative to our capital needs, and given the operational challenges with the ongoing COVID-19 pandemic, we believe that exploration of all options is the appropriate course of action,” concluded Mr. Flesher.

Disclaimer: We have no position in Novus Therapeutics Inc. (NASDAQ: NVUS) and have not been compensated for this article.