Healthcare stocks, particularly pharmaceutical stocks, have often given their investors headaches. Edesa Biotech (NASDAQ:EDSA) is joining the ranks of the infuriating, down over 44% in Tuesday’s trading session.
The last five days for Edesa Biotech stock show the decline clearly. Shares went from a quiet graph to a rapid plunge. Worse yet, the stock continued its decline even after the worst of the news hit.
The plunge traces back to EBO1, Edesa’s new therapy designed to take on Allergic Contact Dermatitis (ACD). More specifically, it’s designed to take on chronic cases of ACD that are rated between moderate and severe in scope. The study covered 200 patients treated with EBO1 in concentrations of 0.2%, 1%, and 2%, along with a control group using a placebo. The results did not turn out well.
Patients that were treated with 1% EBO1 landed a 60% average improvement in their conditions. Those with a placebo, however, landed a 39% improvement. Neither the 2% nor 0.2% could produce any better results.
Edesa’s CEO, Par Nijhawan, M.D., immediately made hay while the sun shined, noting that the lower concentration producing results may make the EBO1 treatment ultimately less expensive, should EBO1 ever actually go public. This may actually happen; reports note that Edesa is currently readying itself for a meeting with the FDA to discuss the end of Phase 2 data, complete with analysis, that should be ready by mid-year.
