MENLO PARK, Calif. (TheStreet) -- I'm struggling to adequately describe the awfulness of Avalanche Biotechnologies' (AAVL) performance Monday night trying to explain and defend the mediocre results of its gene therapy study in wet age-related macular degeneration (AMD).
I wanted to slam my forehead against the desk after Avalanche CEO Tom Chalberg Jr., speaking on a conference call, repeated for what seemed like the 600th time, "The key takeaway today is that it's a positive study."
Thanks, Tom, that was so helpful. Unfortunately for you, the market disagreed. While you were insisting over and over again that wet AMD patients benefited from treatment with Avalanche's AVA-101 gene therapy, the company's stock was down 25%.
When the market learned that you and a gaggle of other insiders sold Avalanche stock last week, ahead of Monday's study results, shares fell 30%. Two of the Form 4s, which shows insider trading activity, were filed with the Securities and Exchange Commission Monday night!
And when the market realized you and your fellow executives were so ill-prepared to answer questions on the conference call, the stock fell 40% as you resorted to simply re-reading the press release.
Truly awful, guys!
The painful lesson here is that Avalanche's study of AVA-101 may have achieved its primary efficacy endpoint, but the gene therapy failed the more important common sense endpoint.
Avalanche touted the improvement in visual acuity by 11.5 letters on an eye chart over one year between the wet AMD patients treated with AVA-101 compared to control patients. Investors looked deeper, however, and realized that the visual acuity in the AVA-101 patients improved by only 2.2 letters but fell by 9.3 letters in the control arm. The only reason Avalanche could claim success in this gene therapy study was because the patients not treated with gene therapy performed so poorly.