Peregrine plummets after unreliable lung cancer trial

Peregrine Pharmaceuticals Inc. plunged the most ever after the biotechnology company said the survival rates from its lung cancer study reported earlier this month were unreliable.

Peregrine, based in Tustin, declined 74% to $1.42 at 10:12 a.m. New York time, after falling as low as 80 cents in its biggest intraday drop since the stock began trading in 1994. The shares of the company had more than quadrupled in the past 12 months through last week.

Peregrine had soared 47% on Sept. 7 after the company said non-small cell lung cancer patients who took the drugmaker’s experimental bavituximab lived twice as long as those on placebo. Peregrine said in a statement today that it “discovered major discrepancies” between patient test results and treatment code assignments by the independent contractor responsible for the distribution of the medicine in the study.

“Today’s news comes as a shock and we believe represents a major blow to confidence in the bavituximab program,” Joseph Pantginis, a New York-based analyst for Roth Capital Partners, wrote in a note to investors. “The level of uncertainty surrounding the stock at this point is a major hurdle needing to be addressed.”

Pantginis downgraded the stock to neutral, and lowered his price target to 70 cents from $9.

“Investors should not rely on previously reported clinical data,” Peregrine said in the statement. A call to the company wasn’t immediately returned.