On August 28, Guilford Pharmaceuticals (Baltimore, MA) shelved plans to acquire Gliatech (Cleveland, OH) after it emerged that the US Food and Drug Administration (Rockville, MD) had questioned irregularities in the clinical trial data of Gliatech's anti-scarring gel, Adcon-L. The cancellation of the $203 million deal sent Gliatech's share price plummeting over 60%, and shareholders threatened to sue the company.

In August, the FDA sent Form 483 to Gliatech questioning the recording and presentation of some of the data submitted for US regulatory approval in 1998. In particular, concerns were raised over the re-scoring of 115 out of 324 magnetic resonance imaging (MRI) scans, which were used to measure the thickness of the patients' scar tissue. The FDA also cited “erasures and writeovers” of the data, which made Adcon-L appear more effective at reducing scar tissue than the original data. Although Gliatech claims that the original MRIs had been rescored as part of an “intraobserver reliability study,” it ousted its president and CEO Thomas Oesterling and started an internal investigation. Adcon-L is Gliatech's only financially significant product, generating sales of $26 million last year. If the FDA finds Gliatech guilty of tampering with clinical data, it could withdraw the product from the market. Although Gliatech has variants of Adcon-L for use after other types of surgery, Jonas Alsenas of ING Barings (New York) says the confidence of both regulators and the investment community has been dented. Guilford, he adds, may have been “voting with its feet” and Gliatech could find it difficult to find a new partner.