Ista Shares Plunge on Drug Woes

Shares of Ista Pharmaceuticals Inc. plunged 68% on Tuesday after it said data from its study of treatment of patients with bleeding in the eye failed to show statistically significant improvement.

Ista said data from its Phase III studies of a single injection of Vitrase for treatment of severe vitreous hemorrhage, or bleeding inside the eye, didn’t meet its primary goals.

As a result, the Irvine company was downgraded to a “hold” from “strong buy” by CIBC World Markets. Ista shares closed at 91 cents, down $1.92, on Nasdaq.

Though Ista didn’t achieve its primary goal, it noted “clinically relevant” improvements in patients’ ability to read an eye chart several months after receiving the Vitrase injection. The primary goal of the study was to clear the hemorrhage enough to allow further diagnosis or treatment. But Ista didn’t achieve a statistically significant improvement in that category.

The only current treatment available for vitreous hemorrhage is surgery.

About 450,000 cases of vitreous hemorrhage occur each year in the United States, and the company said about half of those cases would be candidates for treatment with Vitrase.

The company said it had no comment on Tuesday’s sharp drop in its share price.