Why Evelo Biosciences (EVLO) Stock Is Falling Today - Evelo Biosciences (OTC:EVLO)

Evelo Biosciences Inc EVLO said it observed an unusually high placebo response rate in the first three cohorts of the EDP1815 Phase 2 atopic dermatitis study, resulting in a missed primary endpoint.
The company said it is working through the data to understand the very high placebo rates observed in the trial, which occurred with greater prevalence in certain geographic regions.
The trial's fourth cohort, designed to test the faster release formulation, is fully recruited, and data from this cohort is expected in Q2 2023.
The first three cohorts of the EDP1815-207 trial failed to meet the primary endpoint, the proportion of patients who achieved an outcome of at least a 50% improvement from baseline in Eczema Area and Severity Index score compared to placebo at week 16.
In all three cohorts, EDP1815 was well-tolerated.
EASI-50 responses or greater were achieved in 41%, 38%, and 32% of patients with mild to moderate disease at week 16 in cohorts 1, 2, and 3, respectively.
Patients on placebo had an overall EASI-50 response of 56%. Placebo responses varied significantly by geography.
The company's Board of Directors has asked Simba Gill to remain in his position as CEO, and the company has halted the search for his successor.
The company has taken actions to implement cost reduction initiatives, including a reduction in the workforce, expected to extend its cash runway into 3Q 2023.
Evelo is actively discussing partnership opportunities across EDP1815, EDP2939, and the EV platform.
Price Action: EVLO shares are down 21.19% at $0.8196 on the last check Wednesday.

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Evelo Biosciences' Atopic Dermatitis Study Fails, Observes Unusually High Placebo Response Rates