(Reuters) - Ardelyx Inc (ARDX.O) said chronic kidney disease patients treated with its kidney drug experienced higher-than-expected levels of diarrhea in a mid-stage study.
The company's shares fell as much as 32 percent to $18.30, wiping out about $160 million (106 million pounds) from its market valuation and putting the stock on track for its worst day since its debut in June last year.
The drug, Tenapanor, being co-developed with AstraZeneca PLC (AZN.L), however, met the main goal of "significantly" reducing phosphate levels in patients who were on dialysis.
Wedbush analyst David Nierengarten, said that the levels of diarrhea were "potentially higher" than the company's last trials.
"Diarrhea can be an issue in this patient population because fluid levels are important for these patients," Nierengarten said.
Chronic Kidney Disease is characterized by an ever-worsening loss of kidney function. Kidneys are unable to flush out waste, resulting in abnormally high levels of phosphate in the blood, a condition known as hyperphosphatemia.
Hyperphosphatemia has been known to be a cardiovascular risk factor to chronic kidney disease patients and they often need complete blood transfusion.
More than 10 percent of adults in the United States may be suffering from CKD, according to the U.S. Center for Disease Control and Prevention.
Ardelyx licensed the drug to AstraZeneca in October 2012. Under the terms of the agreement, AstraZeneca handles the development costs for tenapanor, while Ardelyx runs the trials.
The drug is also being tested to treat patients with constipation-related irritable bowel syndrome. Ardelyx said on Oct. 1 that the drug achieved its main goal of increasing patients' bowel movements in a mid-stage study.
Since then, Ardelyx shares has risen 90 percent through Friday's close of $27.01.
Editing by Savio D'Souza