Biota shares hit hard by flu drug test failure SHARES in Biota slumped more than 10 per cent yesterday after a study found weakness in the preventative ability of its long-acting flu drug Inavir. While the drug is on the market in Japan, trials are ongoing for approval of the drug as a preventative of influenza, rather than just a treatment. But Biota said yesterday an influenza phase III prophylaxis study, conducted during the 2009-2010 pandemic flu season in Japan, found the protective efficacies of Inavir were lower than required. The failure means Biota's Japanese partner, Daiichi Sankyo, would have to conduct and fund another study, which RBS Morgan's analyst Scott Power said left Biota's cash position unaffected. "It's not that significant," Mr Power said of the results. The fact that it's disappointing, the fact the market is not paying for risk at the moment, means the share price got marked down. In our view, the stock is fundamentally cheap. Investors dumped the Melbourne drug developer in a weak market, sending it down 10.3 per cent to 91.5c and cutting its market value by $20m. Mr Power has a buy and $1.99 price target on the stock. The study measured influenza transmission from an affected patient to other family members, although there were no restrictions on other preventative measures such as masks, hand washing or isolation of the infected patient. It showed the protective efficacies of 20mg and 40mg inhaled doses, as measured by the risk reduction rate (RRR), was 43.7 per cent and 43.2 per cent respectively. This was lower than the required preset RRR endpoint of 70 per cent, Biota said. "The possible reasons offered for the lower protective efficacies were the low infection rate within families in the placebo group (8.6 per cent) and the growth in public awareness, resulting in the use of other preventative infection measures, " the company said. Mr Power agreed and said a larger study was required. Inavir is a new class of long-acting neuraminidase inhibitors (LANIs) that can be given on a "one and done" basis.