Coley Pharmaceutical drug given the ax

Earlier this afternoon, Coley Pharmaceutical Group Inc (NASDAQ: COLY) announced that Pfizer Inc (NYSE: PFE) would discontinue the development program of an investigational drug compound - PF-3512676 - in combination with cytotoxic chemotherapy for the treatment of lung cancer. After two Phase 3 clinical trials and two Phase 2 clinical trials, an analysis by an independent Data Safety Monitoring Committee found that there was "no evidence that PF-3513676 produced additional clinical efficacy over that achieved" with cytotoxic chemotherapy alone. The DSMC said that the "risk-benefit profile did not justify continuation" of the compound trial, and Pfizer, apparently, agreed.

This news comes as a huge blow to Coley, whose main thesis drug is PF-3512676, and who is trying to become a force-to-reckon-with in the oncology field. In a statement, president and CEO Robert L. Bratzler, Ph.D., said that the announcement was "surprising, based on the signs of clinical activity observed."

On the announcement, shares of Coley were down approximately 60%. As of March 31, the company had $3.35 per share in cash. Coley will be hosting a conference call and webcast this afternoon at 4:30 p.m. (EST) to discuss this development.