Zafgen (ZFGN) Won't Comment on 56% Stock Plunge
Zafgen (NASDAQ: ZFGN) issued the following statement to StreetInsider.com in response to questions about the 56% plunge in its stock price over the past two sessions after the company unexpectedly pulled out of a non-deal roadshow, which led to speculation something ominous was forthcoming:
"We have received a number of inquiries from the investment community. As you are aware, we do not comment on share price movement or market speculation. We appreciate the concerns of our stakeholders. Zafgen remains committed to developing novel therapies to improve the health and well-being of patients affected by obesity and complex metabolic disorders."
Earlier, RBC Capital analyst analyst Simos Simeonidis weighed in with several theoretical scenarios for the plunge. He sees a 35% chance the action is related to data for either the bestPWS or the Phase IIb ZAF-203 severe obesity trial. Other scenarios include: M&A (10%), Ex-US partnership (10%), CEO is leaving (10%), and Safety issue with beloranib (35%).
Simeonidis noted the company previous guided bestPWS data for "early 1Q16" and Phase IIb obesity data for "late 2015, early 1Q16." He sees a higher chance of bestPWS data (20% vs 15%).
On a possible safety issue with beloranib, the analyst said, "Even though the drug has had a relatively benign safety profile until now, the obvious risk in the PWS trial is that it has been in a small number of patients in PWS (n=17 in the phase IIb trial) and it is now in 108 patients in the bestPWS Phase III trial. In addition, in the Phase III trial the company is testing the 2.4mg dose, which hasn’t been tested in PWS patients before (the Phase IIb doses were 1.2 and 1.8mg). Finally, the Phase IIb trial was only four weeks, while the bestPWS trials is six months."