Pharmaceutical company Circassia has lost more than half its value this morning after its experimental cat allergy treatment failed in a late-stage trial.
The firm's stock was down by 64.85 per cent in early trading.
Circassia said the study showed that both the treatment regimens and the placebo "greatly, and equally, reduced subjects' combined allergy symptom and rescue medication use score from baseline". As a result of the "very marked placebo effect" the treatment did not meet the study's primary endpoint.
"We are surprised and disappointed by these results," said Circassia chief executive Steve Harris.
"Such a dramatic placebo effect was not a feature of our earlier phase II studies. However, in this large-scale trial it eliminated the ability to identify a treatment effect despite dramatic improvements in subjects' allergy symptoms and rescue medication use.
"We will now rapidly analyse the full dataset, address the implications for our wider allergy pipeline and provide an update on the development plans for our broader business at our interim results. At the same time, we will continue to focus resolutely on our wider portfolio."
Circassia floated in 2014, and said it would use the money raised in its IPO to begin rolling its cat allergy treatment out to the public.