Antisoma, the British biotechnology group, today saw £39.1 million wiped off its market value after admitting a drug it hoped to use to treat ovarian cancer had failed.

Shares in Antisoma plunged by 17.8 per cent to 35.75p when its revealed that stage two trials using a compound called AS1404 to treat ovarian cancer showed that there had been no effect on tumours compared to using chemotherapy. Its market capitalisation fell from £198.6 million to £159.5 million.

However, AS1404 used for stemming lung cancer has proved more successful. Novartis, the Swiss drugs giant that struck an $890 million (£437 million) funding agreement with Antisoma in April, will begin to enrol patients in phase three trials for lung cancer treatment using the drug.

A spokesman for Antisoma said there would be no immediate cuts to funding provided by Novartis. The agreement is based on AS1404 gaining approvals for four cancer treatments and one non-cancer condition.

Antisoma has a chequered past regarding treatments for ovarian cancer. Roche, a Swiss rival of Novartis’, recently decided not to proceed with AS1404 for ovarian cancer, despite some success in early trials. Four years ago, Antisoma admitted that R1549, another ovarian cancer treatment that took six years to develop, was not effective.

Roche has a five-year agreement to use treatments developed by Antisoma, but the contract ends in November. It is not yet clear whether Roche will choose to renew its contract.

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