Alector's stock plummeted nearly 60% in pre-market trading as the drug developed in collaboration with GlaxoSmithKline failed to slow the progression of dementia

According to the Zhitong Finance APP, British pharmaceutical company GlaxoSmithKline (GSK.US) announced that its experimental drug latozinemab, developed in collaboration with American biotechnology company Alector (ALEC.US), failed to slow the progression of dementia, marking another failure in the development of a potential dementia treatment drug. This drug was developed by Alector and targets a type of dementia known as "frontotemporal dementia." Following this announcement, Alector's stock plummeted nearly 60% in pre-market trading on Wednesday. GlaxoSmithKline stated that it will terminate the clinical trial and analyze the results. Alector announced on Tuesday that its experimental drug failed to slow the progression of a rare form of dementia in a late-stage clinical trial, prompting the company to terminate the study and cut nearly half of its workforce. The drug, named latozinemab, was being tested on patients with frontotemporal dementia caused by mutations in the progranulin gene. Such genetic mutations can lead to early onset and severe cognitive decline in patients. This drug originated from a collaboration agreement between Alector and GlaxoSmithKline reached in 2021, with a potential value exceeding $2 billion. The trial was conducted jointly by Alector and its partner GlaxoSmithKline over a period of 96 weeks. Results showed that, based on commonly used assessment criteria, the drug did not provide clinical benefits in slowing disease progression, although it did increase the levels of a key protein in patients' blood. Alector stated that the company will focus on other experimental therapies for Alzheimer's disease and Parkinson's disease in the future, including projects related to delivering drugs across the blood-brain barrier using its proprietary technology. The company reported that as of the end of September, it had approximately $291.1 million in cash and investments, sufficient to support operations until 2027. Alector and GlaxoSmithKline are still collaborating on the development of early-stage Alzheimer's disease treatments, with related clinical trials having started this year. In early trading on the London Stock Exchange, GlaxoSmithKline's stock fell by as much as 1.4%, and as of the time of writing, GlaxoSmithKline's stock was up 0.59% in after-hours trading. Although this drug is not a key support for GlaxoSmithKline's future sales, the failure of this trial still poses a setback to the development goals of the British pharmaceutical company and further hampers the overall efforts of the pharmaceutical industry in the field of dementia treatment. GlaxoSmithKline's Chief Medical Officer stated that insights gained from the development of latozinemab may help in understanding the mechanisms of neurodegenerative lesions in current research. Alector plans to cut nearly half of its workforce and announced that its head of research and development will resign. Internally at GlaxoSmithKline, outgoing CEO Emma Walmsley is facing pressure from investors regarding the company's new drug development pipeline—investors are concerned about whether GlaxoSmithKline has the right strategy to achieve its goal of exceeding £40 billion in sales by 2031. Her successor, Luke Mills, will take office in January next year