MedImmune's stock falls on AIDS drug uncertainty

January 06, 1993|By Liz Bowie | Liz Bowie,Staff Writer

MedImmune Inc.'s stock dropped nearly 20 percent yesterda as the market reacted to news that Merck & Co. was

re-evaluating whether to continue development of an AIDS drug with MedImmune.

The stock, which trades on NASDAQ, dropped $4, to $19.25, in heavy trading after the Gaithersburg company said the first tests of the AIDS drug in animals produced "unexpected research results."

Analysts said they believed the company was preparing the market for an announcement that MedImmune would drop development of the product, called MEDI 488.

But the company's chief executive, Wayne T. Hockmeyer, said yesterday: "I don't think people should interpret this as the research program won't go forward." Merck will do further laboratory tests to decide the future of the project, he said.

MEDI 488 would be used as a vaccine given to people, such as health care workers, who could be exposed to HIV, which causes AIDS. But it would probably not be a vaccine for the general public because immunity would last only three weeks.

The company said the stock market overreacted to the news, particularly because the AIDS drug project was only in early stages of research.

In addition, Dr. Hockmeyer said, the company has made two positive announcements this week. On Monday, the company asked the U.S. Food and Drug Administration to license a drug to prevent a respiratory disease in children.

In addition, the company said it has reacquired the distribution rights for its primary product, Cytogam, for prevention of a disease associated with kidney transplants.

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