Alector slumps on late-stage trial setback for GSK-partnered dementia candidate

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Alector (NASDAQ:ALEC [https://seekingalpha.com/symbol/ALEC]) shares extended post-market losses to drop ~50% in the premarket on Wednesday after the neurology-focused biotech announced a Phase 3 trial failure for latozinemab, an experimental therapy it was developing with GSK (NYSE:GSK [https://seekingalpha.com/symbol/GSK]) for a form of dementia.

Citing data from its INFRONT-3 clinical trial, Alector (NASDAQ:ALEC [https://seekingalpha.com/symbol/ALEC]) said late Tuesday that the global study evaluating latozinemab in patients with frontotemporal dementia due to a progranulin gene mutation (FTD-GRN) did not meet the co-primary endpoint related to disease progression.

The San Francisco, California-based biotech noted that the secondary and exploratory endpoints didn’t indicate any treatment-related effects on FTD-_GRN_. The company added that there were major safety issues according to the study’s early tolerability results.

Given the outcome, Alector (NASDAQ:ALEC [https://seekingalpha.com/symbol/ALEC]) said it will halt the open-label extension portion of INFRONT-3 and the continuation study for latozinemab.

However, it will still work with GSK (NYSE:GSK [https://seekingalpha.com/symbol/GSK]) on the PROGRESS-AD global Phase 2 clinical trial for its Alzheimer’s drug nivisnebart, which is expected to conclude next year and have an interim analysis in the first half.

Concurrently, Alector (ALEC [https://seekingalpha.com/symbol/ALEC]) announced plans to focus its resources on its high-priority programs as part of a major restructuring drive, which it said would lead to job losses for nearly 49% of its workforce.

The company added that its R&D head, Sara Kenkare-Mitra, will also resign effective Dec. 22 to seek other opportunities.

According to ALEC, its cash, cash equivalents, and short-term investments valued at $291.1M as of Sept. 30 will be sufficient to fund its operations through 2027. [https://seekingalpha.com/pr/20274395-alector-announces-topline-results-from-latozinemab-phase-3-trial-in-individuals-with]

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