Shares of Threshold Pharmaceuticals Inc. lost more than half their value after the company said it was dropping its benign prostatic hyperplasia drug, TH-070, following misses in Phase II and Phase III studies.

The decision comes two months after the Redwood City, Calif.-based firm announced a partial clinical hold on the TH-070 (lonidamine) program due to toxicities associated with elevated liver enzymes.

Combined with an apparent lack of efficacy in symptomatic improvement - either in a placebo-controlled Phase III trial or a dose-response Phase II evaluation - the drug has little chance going forward in BPH.

"If we'd seen efficacy in the results we just reported, we could go back and try lower doses to reduce the safety signals," said Threshold CEO Barry Selick, "but there's no way we can go back and increase the dose."

The Phase III study, which enrolled 567 men with moderate to severe BPH, tested daily doses of 50 mg or 150 mg of TH-070 against placebo, with the primary endpoint of improvement based on the International Prostate Symptom Score (IPSS).

Interim analysis of the data failed to show a statistically significant difference in mean IPSS change from baseline among the two dose groups (-4.8 for the 50-mg arm and -4.4 for the 150-mg arm) and the placebo group (-5.5) over three months of treatment.

No statistical significance was seen in any of the secondary endpoints, with the exception of a change in prostate specific antigen (PSA).

Results from the Phase II trial also failed to show a significant difference in IPSS change from baseline between four dose groups ranging from 5 mg to 150 mg and placebo.

Selick declined to speculate on TH-070's poor performance, except to say that "the placebo effect was likely greater than we anticipated."

Data also were inconsistent with an earlier Phase II study conducted in Italy, which suggested significant improvement as measured by IPSS, as well as improvements in maximum urine flow, post-void volume and PSA.

The company's stock (NASDAQ:THLD), which had been trading around $14 before the TH-070-related toxicity issues caused investors to depart in mid-May, has fallen nearly 90 percent since then. Following the partial clinical hold, shares plunged 75 percent to $3.44. (See BioWorld Today, May 15, 2006.)

Monday's news caused shares to lose another $1.63 to close at $1.55.

Although the company has another cancer product - glufosfamide - that is expected to report Phase III results this year, investors haven't put much value there.

"I think people were focused on BPH because it was such a huge potential opportunity," Selick told BioWorld Today, "and very little emphasis has been placed by the investment community on glufosfamide.

"But we're as bullish on glufosfamide as we were the day we acquired it, and so far, the risk-benefit profile of that drug clearly justifies continued development."

Glufosfamide is in a pivotal Phase III study as a second-line treatment in metastatic pancreatic cancer, an indication for which it has fast-track status. A Phase II trial is ongoing to evaluate glufosfamide in combination with gemcitabine as a first-line therapy. Top-line results from that study also are expected by year end.

Selick said the company's goal is to initiate a trial of glufosfamide in another indication before the end of the year.

"Clearly, everyone associated with the company is disappointed with [the TH-070] trials," he said. "But we are going to doubly focus our efforts on the other programs in our portfolio and continue to look for in-licensing and acquisition activities."

TH-070 was the only product in Threshold's pipeline aimed at BPH, a condition characterized by an enlarged prostate that can interfere with urine flow. BPH is estimated by the National Institutes of Health to affect more than 50 percent of men older than 60 and as many as 90 percent of men older than 70.

"It's a difficult disease to have a major impact on," Selick said. "Even those drugs that are approved still have some serious shortcomings."

Other companies have encountered difficulties in the BPH space, as well, such as Vancouver, British Columbia-based QLT Inc., which reported early data in February showing that its light-activated BPH drug LT0074 failed to meet its primary efficacy objective in a Phase II study. And Lilly ICOS LLC, a joint venture between ICOS Corp., of Bothell, Wash., and Eli Lilly and Co., of Indianapolis, informed shareholders that plans for a Phase III trial of tadalafil would be delayed because the FDA asked that an additional Phase IIb dose-ranging study be completed first. (See BioWorld Today, Feb. 17, 2006.)

Threshold did not disclose whether discontinuing TH-070 development will affect its financial position, but the company is expected to offer more information during its Aug. 9 earnings call.

Threshold reported a net loss of $13.8 million for the first quarter, and ended that three-month period with $87.4 million in cash.