Aryx Keeps Biotech Investors Humble

Biotech is a cruel mistress. On a day when I'm beaming over Amgen's(AMGN Quote) success with denosumab, I'm also smarting over Aryx Therapeutics(ARYX Quote) and the disappointing results from a study of its blood-clotting drug.

Both stocks are long picks in my Biotech Select model portfolio (defunct but soon to be resurrected, so stay tuned). Amgen is up big Wednesday morning, while Aryx is down bigger. And so it goes with biotech.

Aryx reported Tuesday night that its blood-clotting drug tecarfarin failed to demonstrate superiority over the anticoagulant warfarin in a phase II/III study that enrolled about 600 patients with a variety of conditions requiring them to be on chronic blood-thinning therapy.

Tecarfarin is supposed to be a re-engineered and safer version of the widely used warfarin, designed to give doctors and patients more stable control over blood clotting. Warfarin is very effective but requires a lot of monitoring and dose adjustments -- something Aryx hopes tecarfarin can avoid.

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In the phase II/III study, tecarfarin worked as expected, with patients staying within the targeted therapeutic range 74% of the time. Unfortunately warfarin performed way better than expected, with patients in the targeted therapeutic range 73% of the time.

That's bad luck for Aryx, for while the two drugs posted equivalent efficacy, the company designed the trial to demonstrate tecarfarin's superiority over warfarin. Therefore, this is a failed study.

Based on historical studies of warfarin, Aryx expected the drug to keep patients in the targeted therapeutic range about 67% of the time, which is why they believed tecarfarin could demonstrate superiority.