Zafgen swings and misses a third time

Zafgen's latest clinical hold makes it third time unlucky for the company – and raises questions about its future. The group yesterday shelved clinical trial plans for ZGN-1258 in Prader-Willi syndrome after signs of muscle degeneration in rodents in long-term toxicology studies. The news came after the FDA had previously challenged the safety of two other projects emerging from Zafgen’s MetAP2 platform, one of which, beloranib, has already landed in the dustbin. Meanwhile, yesterday the company said it was working towards a meeting with the FDA to review the clinical hold on the diabetes candidate ZGN-1061, imposed in November; an update should be available in the second quarter. The ZGN-1061 hold had come after promising data with that project briefly resuscitated the group last June. Today Zafgen's already depressed stock fell 25% in premarket trading, putting the group’s valuation at near cash levels. The company's only other pipeline asset, the preclinical-stage ZGN-1345, is another MetAP2 inhibitor, so there cannot be much hope. Zafgen has $118m in cash, so its prospects for reinvention might be limited.