(Adds analyst's comments, background; updates share movement)
By Varsha Tickoo
BANGALORE, March 12 (Reuters) - Progenics Pharmaceuticals Inc's (PGNX.O) lead product, which failed a late-stage trial, may have to weather a long wait for approval, analysts cautioned, wiping out more than two-thirds of the drugmaker's market value.
Analysts at three brokerages downgraded the stock after the company on Wednesday said the intravenous form of its drug failed to improve bowel movements following surgery to remove parts of the colon.
"We have seen this movie a hundred times," Citigroup analyst Yaron Werber said in a note to clients. "Data release gets delayed, there is a lame excuse, and when released, the data is negative."
Progenics, whose stock fell to a five-year low on the news, is co-developing the drug, methylnaltrexone, with Wyeth WYE.N, whose shares were down more than 2 percent in afternoon trade.
Shares of Adolor Corp ADLR.O, which is also developing a bowel drug called Entereg, rose as much as 13 percent on Wednesday.
Analysts expect another late-stage trial evaluating Progenics' methylnaltrexone to also fail.
"We expect the next POI (post-operative ileus) trial to fail as well," Joel Sendek from Lazard Capital Markets said. He cut his rating on the stock to "hold" from "buy."
Post-operative ileus is a gastrointestinal disorder that is common after bowel resection surgery, and marked by stomach bloating and pain, nausea, and constipation. No drugs are approved to treat POI.
Citigroup's Werber does not expect the subcutaneous form of the drug to receive U.S. Food and Drug Administration approval by this April, as scheduled earlier, and said the drug's launch could be delayed to 2011.
Werber cut Progenics to "sell" from "hold," and slashed the price target on the stock to $5 from $19.
Cowen & Co analyst Leland Gershell said the subcutaneous form of the drug would probably receive an "approvable letter" from the FDA, which means the company will have to submit more data to the health agency before the drug can be cleared for the market.
Gershell downgraded the drugmaker to "neutral" from "outperform."
The FDA has extended Entereg's review due to some safety concerns, but even with this hitch, it would probably be approved before Progenics' drug, Brean Murray Carret & Co analyst Jonathan Aschoff said in a note.
Aschoff cut Progenics' price target to $15 from $35. He raised Adolor to "buy" from "hold" and set a price target of $9.
Shares of Progenics fell to a low of $4.33, before pulling back some of the losses to trade down $8.76 at $4.79 in afternoon trade on Nasdaq.
Wyeth's stock was down 90 cents at $40.75 on the New York Stock Exchange.
Shares of Adolor were trading up almost 10 percent at $4.70 on Nasdaq, while Glaxo's stock was up 1 percent at $42.30 on the NYSE. (Editing by Pratish Narayanan)