KALA Stock Crashes 88% in a Month Following Eye Disorder Study Failure

Shares of KALA BIO KALA have nosedived 88.3% in a month after the company announced the failure of a mid-stage study evaluating its only clinical pipeline candidate, KPI-012, for the treatment of persistent corneal epithelial defect (PCED), in late September.

KALA’s phase IIb CHASE study assessed the safety and efficacy of two doses of KPI-012 ophthalmic solution (3 U/mL and 1 U/mL) compared with a vehicle control, administered topically four times daily for 56 days. A total of 79 patients with confirmed PCEDs at baseline were randomized to receive either KPI-012 or the vehicle control.

KALA’s Mid-Stage PCED Study Data in Detail

KALA BIO reported that the phase IIb CHASE study of KPI-012 for PCED failed to meet its primary endpoint of complete PCED healing, as measured by corneal fluorescein staining and evaluated by a masked central reading center. The study also failed to achieve statistical significance for key secondary efficacy endpoints.

Additionally, no meaningful difference was observed between the KPI-012 treatment arm and the placebo group. The therapy, however, continued to show a favorable safety profile, consistent with that observed in earlier studies.

Year to date, KALA stock has plunged 76.4% against the industry’s 8.1% growth.

Following the setback, KALA BIO decided to discontinue development of KPI-012 and its broader mesenchymal stem cell secretome (MSC-S) platform. The company also intends to explore strategic alternatives, including discussions with its secured lender, while implementing cost-control measures, such as workforce reductions and other operational cutbacks to conserve cash.

This development effectively reverts KALA BIO to the preclinical stage, significantly delaying its prospects of advancing a product toward regulatory approval and establishing a consistent revenue stream. The outcome marks a major blow for the company, which had been banking on KPI-012 as a key value driver following encouraging early-stage data.

The discontinuation of the MSC-S platform will likely also halt KALA BIO’s preclinical efforts on KPI-012 for limbal stem cell deficiency and other rare corneal disorders that threaten vision, as well as the development of KPI-014 for rare inherited retinal diseases.

KALA BIO, Inc. Price and Consensus

KALA BIO, Inc. price-consensus-chart | KALA BIO, Inc. Quote

KALA's Zacks Rank & Stocks to Consider

KALA BIO currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the biotech sector are Akero Therapeutics AKRO, Allogene Therapeutics ALLO and Chemomab Therapeutics CMMB, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the past 60 days, estimates for Akero Therapeutics’ 2025 loss per share have narrowed from $3.92 to $3.74. Loss per share estimates for 2026 have narrowed from $4.35 to $4.12 during the same period. AKRO stock has surged 65.3% year to date.

Akero Therapeutics’ earnings beat estimates in three of the trailing four quarters while missing the same on the remaining occasion, the average surprise being 49.24%.

In the past 60 days, estimates for Allogene Therapeutics’ 2025 loss per share have narrowed from $1.02 to 96 cents. Loss per share estimates for 2026 have narrowed from 95 cents to 84 cents during the same period. ALLO stock has lost 36.7% year to date.

Allogene Therapeutics’ earnings beat estimates in three of the trailing four quarters, while meeting the same on the remaining occasion, with an average surprise of 14.03%.

In the past 60 days, estimates for Chemomab Therapeutics’ 2025 loss per share have narrowed from $2.40 to 60 cents. Loss per share estimates for 2026 have narrowed from $2.80 to $1.00 during the same period. CMMB stock has plunged 51.9% year to date.

Chemomab Therapeutics’ earnings beat estimates in three of the trailing four quarters, while meeting the same on the remaining occasion, with an average surprise of 26.25%.

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