Biotech Stock Plummets Amidst Lung Cancer Trial Failure
A significant downturn has struck shares of a prominent ASX-listed biotechnology company, with its value nearly wiped out following the disappointing outcome of its lead drug candidate in a crucial lung cancer trial. The company, Immutep, saw its share price nosedive by an astonishing 90 per cent, plummeting to just 4 cents by midday on Friday. This dramatic fall has shrunk its market capitalisation from an impressive over $500 million down to a mere $52 million, a figure now less than the company’s readily available cash reserves.
Financial Snapshot and Strategic Setback
At the close of 2025, Immutep reported a healthy balance of $99 million in cash and cash equivalents. This financial position was further bolstered by a $29.9 million licensing payment received in January from the Indian pharmaceutical company, Dr Reddy’s. However, these strong financial fundamentals were overshadowed by the company’s announcement regarding its Phase III clinical trial.
The sharp decline in share value was directly triggered by Immutep’s decision to discontinue a Phase III trial investigating the efficacy of its injectable drug, codenamed “efti,” as a treatment for non-small cell lung cancer. This particular form of lung cancer is the most prevalent globally.
Trial Discontinuation and Future Implications
The decision to halt the trial was not Immutep’s alone. An independent oversight committee recommended the termination of the study after an interim “futility analysis” indicated a low probability of success. The trial had enrolled a substantial number of participants, with over 378 patients from 25 different countries diagnosed with advanced lung cancer. Immutep has stated that the trial will now be discontinued, with all enrolled patients to receive appropriate follow-up care in strict adherence to regulatory and ethical guidelines.
The original ambition for this study was to recruit approximately 756 patients. The core objective was to ascertain whether “efti” could work in synergy with Merck’s blockbuster drug, Keytruda. Keytruda, a highly successful cancer therapy with sales reaching $43 billion in 2025, was the benchmark against which “efti’s” potential additive benefits were to be measured.
CEO’s Disappointment and Pivot
Immutep’s Chief Executive Officer, Marc Voigt, expressed profound disappointment and surprise at the trial’s outcome. “We are very disappointed and surprised with the outcome of the futility analysis, in light of efti’s performance in every other clinical trial,” Voigt stated.
Despite this significant setback in the lung cancer arena, Immutep is not abandoning its development of “efti.” The company confirmed its commitment to continuing clinical trials that are evaluating “efti” for other indications. These ongoing studies include its potential as a treatment for:
- Head and neck squamous cell carcinoma
- Soft tissue sarcoma
- Breast cancer
The discontinuation of the lung cancer study is expected to have a positive impact on Immutep’s financial runway, extending its operational capacity well beyond its previously projected mid-2027 timeline.
Shareholder Impact and Broader Market Concerns
Immutep’s largest shareholder is Regal Funds Management, which holds a substantial 13.8 per cent stake in the company. This is not the first time Regal has faced significant losses from investments in the biotech sector. In 2025, Regal incurred a nine-figure loss following the collapse of another ASX-listed biotech company in which it had invested.
Regal was forced to write off its entire 30 per cent investment in Opthea in early 2025, after Opthea’s promising treatment for retinal disease failed to meet its objectives in a clinical trial. Opthea’s shares have since remained untraded for several months. Following this previous substantial loss, Regal’s Chief Investment Officer, Philip King, communicated to investors a strategic shift. He indicated that “stocks with event driven binary outcomes will be limited to a far smaller weighting within our strategies going forward,” signalling a more cautious approach to highly speculative investments in the biopharmaceutical space.
