Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL) has taken a real hit early this week on the back of some news related to one of its lead development trials. The company currently trades for around $3.05 a share, down 14% on its preannouncement market capitalization and looks set to give way further as the session gets underway in the US on Wednesday.

So what happened?

Well, Rigel has been trying to prove that a drug called fostamatinib can be a safe and effective treatment in patients with a condition called IgA nephropathy (IgAN). IgAN, also known as Berger’s disease, is a kidney disease that occurs when an antibody called immunoglobulin A (IgA) lodges in the kidneys. This results in local inflammation that, over time, can hamper the kidneys’ ability to filter waste materials from the blood.

The current spectrum of treatments for this condition is severely limited and, if a certain treatment doesn’t work for a patient, the condition can be severe in terms of implication.

With fostamatinib, Rigel was hoping that it could solve this issue.

The drug blocks the receptor signaling that is associated with the root cause and underlying mechanisms associated with the disease and, in doing so, could theoretically not just alleviate the symptoms tied to IgAN but also could potentially cure the disease completely.

Well, that’s what the company and its shareholders had hoped, at least.

But on the back of the latest data, it doesn’t look as though that is the case.

As per the release detailing the trial’s outcome, the study did not meet its primary endpoint, which was mean change in proteinuria comparing fostamatinib dose groups to placebo. In other words, the trial failed to demonstrate any significant degree of efficacy in this patient population – at least at first glance.

There is some reprieve, however.

In a certain subpopulation of patients with this disease, specifically those patients with more severe forms of the disease, fostamatinib did seem to bring about some degree of clinical benefit. It is this benefit on which the company has pounced subsequent to the release and it’s this subpopulation that will give the best chance (if any) of continuation for this program in this indication.

It is worth noting here that this isn’t the lead indication for fostamatinib, with the drug already submitted to the FDA as part of a new drug application (NDA) that Rigel hopes will pickup approval in a target indication of immune thrombocytopenic purpura (ITP). This NDA is set to be ruled on by the FDA by April 17 and this near-term potential catalyst has served to limit the downside implications of this latest announcement somewhat. To put this another way, if this was the lead indication and there wasn’t a near-term potential approval on the cards for this drug, we would have likely seen Rigel take a much more severe hit to its market capitalization than was the case this week.

So that’s where the next development comes from – the FDA decision on fostamatinib in the ITP indication.

Another mover this week was Bio-Path Holdings, Inc. (NASDAQ:BPTH).

This was also a data-driven move, with the company reporting numbers from a phase 2 trial of a drug called prexigebersen in combination with low-dose cytarabine, which Bio-Path is investigating for the treatment of acute myeloid leukemia (AML). As per the results, the data showed a response rate of 47% (8/17) of evaluable AML patients including 4 patients with complete remission and 4 with stable disease.

This was a far more positive result than that which Rigel was able to record in the above discussed IgAN trial and the market response has been reflective of this as we head into the morning bell on Wednesday in the US.

At the close of play on Tuesday, Bio-Path was trading for a 25% premium to the price at which the company opened the session that same day, closing out at $2.21 a share on the back of more than 100 times average daily volume.

This program now moves into a pivotal trial which will become the focal point of Bio-Path’s market capitalization during the coming 12 months.

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