Negative results for asthma candidate cause Cytos Biotech to look at liquidation

Swiss drug developer Cytos Biotechnology (SIX: CYTN) today revealed that the Phase IIb study of CYT003 in patients with moderate to severe allergic asthma did not achieve a statistically-significant reduction of the Asthma Control Questionnaire (ACQ) score at week 12 in the target patient population compared to placebo.

Shares of the company were decimated on the news, with the stock tanking 94.4% to 0.16 Swiss francs by midday.

As a result of the failure to achieve the primary endpoint, the previously-announced condition for the conversion of convertible loan notes has not been achieved, and the company therefore considers the prospects of raising new funding sufficient to continue as a going concern to be remote. Consequently, the company’s board of directors has instructed management to evaluate the options for an ordinary winding down of operations and liquidation of the company or a possible bankruptcy. In addition, the company has initiated the consultation process for a mass dismissal of all of the company’s 36 employees.