Shares Of Evoke Pharma Tumble 73% On Phase 3 Trial Failure

Today, shares of Evoke Pharma (EVOK) tumbled by 73% after the company announced that its phase 3 clinical trial had failed. The company was testing its drug EVK-001 (metoclopramide nasal spray) in patients with symptomatic diabetic gastroparesis. The results were really disappointing for shareholders, and it is a shame that it was not successful in treating these patients. 

The result at Week 4 was that at 28 out of 41 sites, they saw an improvement of the disease using EVK-001 over placebo. The downside in the result is that at the other 13 of the 41 sites,the placebo performed better than the drug. This problem is what really sent shares tumbling, because the company cannot yet account for the discrepancy in the results. In the 'forward-looking statements' section of the update to its 8K filed today, it says "Evoke is entirely dependent on the success of EVK-001, and Evoke cannot be certain that it will be able to conduct additional trials of EVK-001 or obtain regulatory approval for EVK-001; Evoke will require substantial additional funding to continue to develop EVK-001, and may be unable to raise capital when needed, including to fund ongoing operations ..."

Diabetic gastroparesis is a disease characterized by delayed emptying of the stomach. Patients have trouble emptying their food from the stomach to the small intestine. Patients with the disease experience abdominal pain and bloating. The results of the study are still coming in, and the company will evaluate these additional results as they come. The problem with the company's press release  is that it revealed no future plans for the company. This means investing in this company now is luck of the draw, and should probably be avoided.