ArQule (Nasdaq: ARQL) shares are down 55% today after the company stopped a phase 3 trial for its lung cancer drug ARQ-197. This is the second issue for ArQule's lead drug candidate, with a previous trial halted because of safety-related problems. The good news here is that the drug does in fact appear to be safe. Unfortunately, it doesn't appear any more effective than placebo in treating lung cancer. Without any other drugs on the market, ArQule is just lucky that the crash isn't worse.
Peregrine Pharmaceuticals (Nasdaq: PPHM) recently lost 80% of its value after being forced to throw out its lung cancer trial data. ArQule will try its own drug across other cancer types, which makes sense since plenty of approved drugs work for some conditions and not others. It's a huge setback for Peregrine, but fortunately the company has two years' worth of cash at its current burn rate, so investors aren't at risk for dilution.
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