UPDATE 3-Myriad, Lundbeck Alzheimer's drug fails key study

(Updates with Myriad stock price, further analyst comment)

By Gelu Sulugiuc

COPENHAGEN, June 30 (Reuters) - Flurizan, an experimental drug for Alzheimer's disease, failed to help patients in a pivotal clinical test, dealing a blow to its backers Myriad Genetics (MYGN.O) and Lundbeck (LUN.CO).

Danish pharmaceutical group Lundbeck said on Monday it would take a $100 million writedown in the second quarter following the Phase III test setback, as its shares fell 11 percent.

U.S.-based Myriad said in a separate statement that it would discontinue development of the drug.

Myriad stock lost a more modest 6 percent in pre-market dealings, as investors took comfort from the fact that reduced spending would make the firm profitable earlier than expected.

Flurizan's failure to improve cognition or help patients with day-to-day activities contrasts with recent encouraging results with a rival treatment from Wyeth (WYE.N) and Elan (ELN.I), which proved effective for some people [ID:nL17692292].

"The data is disappointing and it means that Lundbeck has wasted half a billion Danish crowns on this project," said Jyske Bank analyst Frank Andersen.

Lundbeck bought the European rights for the Myriad drug last month for $100 million, hoping it would replace some of the revenue shortfall when blockbuster antidepressant Cipralex/Lexapro loses its patent in major markets in 2012-2014.