Oramed's oral insulin PhIIa details show a compromised study, and shares continue to fall

Some analysts raised their eyebrows at Oramed's ($ORMP) preliminary midstage oral insulin data in late January. Now the Jerusalem-based company has announced further details of the trial that bring to light a dosing issue, and shares have continued their downward spiral ever since.

Beyond the data showing the pill is safe and well-tolerated, which Oramed announced in January, the new results include details regarding the study design, further safety data and pharmacodynamics of the glucose control of the company's ORMD-0801 oral insulin capsule for Type 2 diabetes. The pill isn't intended to replace other treatment regimens but rather to complement existing insulin therapy. The first-ever oral delivery has brought Oramed the furthest in the clinical stage compared with its competitors, including Novo Nordisk ($NVO), Bristol-Myers Squibb ($BMY) and Biocon.

In a 30-patient study that lasted just over 6 weeks, Oramed admitted a "formulation issue ... that resulted in diminished and inconsistent release of study drug." So a third of the patients--those designed to receive the higher doses of the drug at 24 mg--were compromised as far as the study was concerned, receiving only 8 mg of the drug.

Despite this obvious setback, the study did highlight some of the drug's potential. For the uncompromised group who received the 16-mg dose, the patients showed a mean reduction in nighttime glucose levels of about 23 mg/dL for the week compared with a placebo. And the fasting session from 5 a.m. to 7 a.m. provided a greater reduction of over 30 mg/dL on average. Three patients in the group reported adverse events, which Oramed states were not related to the drug.

Oramed's stock, which has plummeted from a late January high of just under $26 per share, closed Tuesday with a steadily decreasing share price of $10.45.

- here's the release