Why Cara Therapeutics Stock Dropped

Cara Therapeutics Stock Chart

Cara Therapeutics stock (NASDAQ:CARA) fell by 27.8% less than on Tuesday. The decline came after the pharmacist announced the results of a phase 2 clinical trial that evaluated oral Korsuva in the treatment of patients with chronic kidney disease (CKD) with moderate to severe (itching) itching.

Cara said oral Korsuva reached the primary endpoint of the study: a statistically significant reduction in the worst average numerical rating scale (WI-NRS) after a 12-week treatment period. However, the drug failed 2 secondary endpoints.

With the strengthening of Cara’s actions, it is clear that investors focus more on Oral Korsuva’s failure to reach the other endpoints of the phase 2 study than on the success of the drug in reaching the primary endpoint.  First bad news was that Oral Korsuva had not achieved a statistically significant improvement in the percentage of patients taking a 1 mg dose who had increased by 3 points or more than baseline in the weekly average of WI-NRS daily scores after 12 weeks of treatment.  The good news is that patients who received the 1 mg dose of oral Korsuva experienced improvement on both secondary endpoints. 72% of patients with 1 mg of oral Korsuva achieved an improvement from baseline by 3 points or higher in daily WI-NRS scores after 12 weeks of treatment, compared to 58% of placebo-treated patients.

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Investors could also look for more better results on the primary endpoint. Patients who received a dose of 1 mg of oral Korsuva reported a 4.4-point reduction in the average weekly WI-NRS scores daily, compared to a 3.3-point reduction for placebo-treated patients. Cara stated that this result “was statistically significant after two weeks of treatment and continued for the 12-week treatment period”.

Derek Chalmers, CEO of Cara Therapeutics, said the company plans to begin a critical phase 3 clinical trial for Oral Korsuva in the treatment of CKD-associated pruritus in 2020. It is possible that a larger clinical study may produce very different results, both better and worse.

Cara Stock Trading Ideas

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We believe there is huge amount of risk in all biotech stocks.   You could get lucky with a “10X stock” one week and then the same stock could be bankrupt the next week.  For those with risky appetite, there may be an opportunity for a “dead cat bounce” long trade on breakout.

Cara Therapeutics Stock Pivots
Pivot Classic Fibonacci Camarilla Woodie DM
S3 7.59 15.67 23.76 13.71 —
S2 15.67 18.75 24.50 16.15 —
S1 20.82 20.66 25.24 21.79 22.29
P 23.75 23.75 23.75 24.23 24.48
R1 28.90 26.83 26.72 29.87 30.37
R2 31.83 28.74 27.46 32.31 —
R3 39.91 31.83 28.20 37.95 —

Cara Therapeutics Stock Recommendations
Aug-12-19 Reiterated H.C. Wainwright Buy $31 → $30
May-29-19 Reiterated Laidlaw Buy $26 → $32
Feb-06-19 Resumed Jefferies Buy $22
Jan-15-19 Initiated BofA/Merrill Neutral $19
Sep-21-18 Initiated Cantor Fitzgerald Overweight
Sep-13-18 Initiated Jefferies Buy $30
Aug-08-18 Reiterated Stifel Buy $22 → $26
Jun-28-18 Reiterated H.C. Wainwright Buy $24 → $26
Mar-12-18 Resumed H.C. Wainwright Buy $22
Feb-12-18 Upgrade Janney Neutral → Buy
Jan-19-18 Initiated Seaport Global Securities Buy $27
Jun-30-17 Reiterated Stifel Buy $24 → $20
Jun-30-17 Reiterated Laidlaw Buy $35 → $30
Jun-30-17 Downgrade Janney Buy → Neutral
Mar-28-17 Reiterated Laidlaw Buy $20 → $35
Mar-28-17 Reiterated H.C. Wainwright Buy $22 → $30
Mar-10-17 Reiterated Laidlaw Buy $17 → $20
Oct-13-16 Initiated H.C. Wainwright Buy $20
Aug-08-16 Reiterated Needham Buy $27 → $23
Feb-29-16 Reiterated Laidlaw Buy $30 → $17

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