Acadia Pharmaceuticals shares plummeted more than 40 percent yesterday after the San Diego company announced that its experimental schizophrenia drug failed in a midstage clinical trial.

The company said it was scrapping further development of the drug, ACP-104.

“We clearly are disappointed in the results of this study,” said Uli Hacksell, Acadia's chief executive. “While we will thoroughly analyze the data to understand the outcome, we currently do not anticipate conducting further studies with ACP-104.”

Acadia's share price fell $3.66, or 43 percent, to close at $4.83.

The drug, which was supposed to help patients with schizophrenia who were experiencing an acute psychotic episode, showed no improved effectiveness over a placebo, the company said. There were 247 patients enrolled in the study at multiple sites around the United States.

The company said it would continue advancing other products in its development pipeline, including pimavanserin, its lead product for the treatment of Parkinson's disease psychosis. Acadia also is developing products to treat sleep maintenance insomnia, chronic pain and glaucoma.

Lucy Lu, an analyst for Citi, said pimavanserin has a greater sales potential than ACP-104 had. Peak sales of pimavanserin could reach $789 million in 2014 if the drug makes it to market, she said. Late-stage study results are expected in early 2009.

“Pimavanserin targets the underserved Parkinson's disease psychosis market where there is no Food and Drug Administration-approved drug,” Lu said. “Theoretically, pimavanserin should demonstrate a benefit in PDP, but other atypical anti-psychotics have had difficulty obtaining clinical success in trials.”

If approved, the drug would compete with Johnson & Johnson's schizophrenia drug Risperdal, which had $1.1 billion in sales during the most recent quarter. Patents on Risperdal expire this month, allowing less-expensive versions to enter the market and putting more pressure on Acadia to show that pimavanserin would benefit schizophrenia patients.

The Associated Press contributed to this report.

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