The Five Dumbest Things on Wall Street This Week

2. Saints and Sinners

Renovis (RNVS Quote) investors were forced into a radical step this week.

Shareholders fled the South San Francisco, Calif., biotech after they learned the company's anti-stroke drug had failed in a clinical trial. News of the setback, released at the eminently sensible hour of 2 a.m. EDT, sent Renovis shares plunging 73% in furious trading Thursday.

Renovis and partner AstraZeneca (AZN Quote) had big plans for the drug, known initially as Cerovive and later designated NXY-059. The companies believed the drug had "free-radical trapping properties" that showed promise of helping stroke victims. They set up three clinical trials, optimistically designated Saint I, Saint II and Chant.

The Saint I study seemed aptly named. Renovis said in February that NXY-059 showed gains in reducing patient disability.

"If these data are supported by the Saint II results," CEO Corey Goodman said, "we believe that NXY-059 could become a broadly useful treatment for acute ischemic stroke patients."

But the halo came off Renovis when the results of Saint II, released Thursday, failed to support the earlier, hopeful findings. Shares careened deep into the single digits -- leaving them down 84% from their March high of $24.

"We are obviously very disappointed by the lack of efficacy shown by NXY-059 in the Saint II study," Goodman said. But, he added hopefully, "We expect that a compound from our collaboration with Pfizer (PFE Quote) to develop VR1 antagonists for pain will enter the clinic in 2007."

Renovis holders are well acquainted with pain by now.

Dumb-o-Meter score: 88. We can only imagine what some investors must be chanting.