Shares of the Brisbane, Calif., biotech at last check were off 61% at $4.86.
The company said in a statement that the study of UBX0101, its treatment for patients with moderate-to-severe painful osteoarthritis of the knee, found "no statistically significant difference between any arm of UBX0101 and placebo."
Unity said it does not anticipate progressing UBX0101 into pivotal studies and will narrow the company’s near-term focus to its ongoing ophthalmologic and neurologic disease programs.
The company said expects to complete collection of the Phase II 24-week data, as well as data from an ongoing Phase Ib study in the second half of the year.
Based on current operating plans, Unity said, its current cash, cash equivalents and investments are sufficient to fund operations well into 2022.
Roth Capital analyst Elemer Piros downgraded the company to neutral from buy and slashed his price target to $4 from $35 following the failure of UBX0101.
“While we are disappointed in the outcome of the 12-week results of the Phase II study of UBX0101, I would like to acknowledge our team’s hard work and commitment to executing a robust study that has provided clear results," Jamie Dananberg, chief medical officer at Unity, said in a statement.
The company had said that it expected to initiate a phase I safety study for UBX1325 for age-related eye diseases in the second half of the year, with initial results in 2021.