NEW YORK (TheStreet) -- Dutch pharmaceutical company Prosensa (RNA) and GlaxoSmithKline (GSK) announced their joint venture to develop an experimental muscular dystrophy drug, drisapersen, failed a phase III clinical trial.
It was hoped the drug would treat Duchenne Muscular Dystrophy (DMD), a neuromuscular disease which affects up to 1 in 3,500 male births. DMD causes loss of muscle function in sufferers, often resigning them to wheelchairs before 12.
"While we are disappointed that this study did not meet its primary endpoint, we remain committed to the overall program and will continue to work closely with GSK," Prosensa CEO Hans Schikan said in a company statement.
Carlo Russo, Senior Vice President, Biopharm Development at GSK, added the companies will evaluate the outcome of the study "to help inform our next steps."
Prosensa shares plummeted 70% and GSK shares were flat as of 3:20 p.m. EST. Shares of Sarepta surged 25% to $44.42.
TheStreet Ratings team rates GSK as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation: "We rate GSK a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its expanding profit margins, increase in stock price during the past year and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows: