Encysive ( ENCY) investors are hoping to get some good news along with the bad. All week, Wall Street has been waiting for the biotech to report that its new pulmonary arterial hypertension drug Thelin has finally won approval from the Food and Drug Administration. But late Thursday, the Bellaire, Texas, company shared some unexpected bad news instead. Rather than announcing Thelin's approval, Encysive said the FDA has stalled clinical trials of TBC3711 -- a next-generation drug that's even more potent than Thelin -- due to problems in a recent animal study. Specifically, Encysive said that human trials of TBC3711 have been placed on hold due to "an unusual finding following dosing with intravenous TBC3711 in a single rat that had displayed abnormalities at baseline." Encysive hopes to test both IV and oral versions of TBC3711 for the treatment of resistant hypertension. Unlike PAH, which Thelin aims to address, resistant hypertension afflicts a large population of patients. Encysive has portrayed development of its new resistant hypertension drug as a "top priority" for the company. The company's stock slid 17 cents Friday to $9.28.
Analysts have widely predicted that Encysive will secure approval for Thelin by Friday, the company's established target. If so, Thelin will follow two other oral PAH treatments onto the market but with evidence of superior performance. Moreover, Thelin will enjoy a big head start against highly touted ambrisentan -- a new PAH drug under development by Myogen ( MYOG) -- that has already been deemed "best-in-class" by some. Recent clinical trials have indicated that ambrisentan could prove safer than other PAH drugs that hit the market sooner. But some people believe that ambrisentan has yet to be tested long enough for problems -- particularly with liver toxicity -- to show up.