WINSTON-SALEM, NC ( TheStreet) -- The lesson from Tuesday's Targacept ( TRGT) TC-5214 tragedy: Never trust clinical data from India.

I repeat: Never trust clinical data from India.

Clinical trials conducted in Russia aren't any more credible, so don't trust data from there either.

I should have had this lesson permanently seared into my brain after making a bad call on Medivation ( MDVN) and its Alzheimer's drug (clinical data from Russia.) But stupid me, I blew it again by predicting success for Targacept and its anti-depressant TC-5214 (clinical data from India.)

Any hope that something positive could be salvaged from the failed TC-5214 phase III study were pretty much dashed this morning when Targacept's CEO, speaking on a conference call, said '5214's effect didn't separate at all from placebo.

If '5214 didn't perform any better than a placebo in alleviating symptoms of depression in this phase III study, the chance that the drug performs any better in the remaining three phase III studies is really low.

And that also means the spectacular data generated from the phase IIb study of TC-5214, conducted largely in India, were a mirage.

It's difficult to reach any other conclusion although Targacept on Tuesday's call insisted that the phase IIb study was conducted with diligence and that its partner AztraZeneca ( AZN) did a lot of confirmatory work before agreeing to license TC-5214 for blockbuster terms.

No one is accusing Targacept of knowingly falsifying data or otherwise trying to run a crappy mid-stage study. But all too often, investors have been burned when experimental drugs post stellar results from studies conducted in Russia, India and other less developed regions only to blow up after the data cannot be replicated in the U.S. or Europe. It's happened to Eli Lilly ( LLY), Biodel ( BIOD) and Novelos Therapeutics in addition to Medivation and now Targacept.

Targacept shares are down $11, or 58%, to $8.20 in Tuesday trading. The company may find support in current cash of about $240 million, or about $7 a share. The remaining three phase III studies of TC-5214 are expected to read out in the first quarter of next year.

If there were any favorable trend supporting TC-5214 in the failed study, I have to believe that Targacept executives would have found a way to say something encouraging, even if AstraZeneca preferred them not to.

It's possible TC-5214 does work and that at least two of the remaining phase III studies will be successful, but I also believed that Targacept was going to sidestep the India data jinx.

I'm not making that mistake ever again.

--Written by Adam Feuerstein in Boston.

>To contact the writer of this article, click here: Adam Feuerstein.

>To follow the writer on Twitter, go to http://twitter.com/adamfeuerstein.

>To submit a news tip, send an email to: tips@thestreet.com.

Follow TheStreet on Twitter and become a fan on Facebook.
Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.