Vion Crushed After Study Halted

Vion Pharmaceuticals (VION Quote) plummeted 56% Wednesday morning after it announced that a late-stage trial for the leukemia drug Cloretazine has been suspended.

The company halted enrollment and further treatment in the phase III trial of Cloretazine, which is used for patients with relapsed adult myelogenous leukemia, on the recommendation of the study's data safety monitoring board.

After an interim analysis, the board felt the advantage of the treatment could be compromised by the mortality rate observed in the study.

"There will be a thorough analysis of all the data to date from this trial, and we will base any decision on the continuation, possible modification or termination of the study on the available data," said Chief Executive Alan Kessman.

Vion's shares plunged $1.10, to 91 cents, in premarket trading.