Sept. 3 (Bloomberg) -- Laboratorios Almirall SA and Forest Laboratories Inc. plunged the most in more than a year of trading after studies questioned the benefits of their experimental drug for a common lung disease linked to smoking.

Almirall fell 6.3 euros, or 42 percent, to 8.7 euros at the close of trading in Madrid, the biggest decline since the company's June 2007 public offering. Forest dropped $5.19, or 14 percent, to $31.08 at 4:15 p.m. in New York Stock Exchange composite trading, the largest drop since Aug. 9, 2000.

Two studies of the inhaled medicine, aclidinium bromide, found less of an effect than was previously seen, Barcelona- based Almirall and New York-based Forest said today in a statement. The drug, for chronic obstructive pulmonary disease, is Almirall's lead product candidate.

``This is clearly disappointing news for the company,'' said Francisco Salvador, a Madrid-based director who follows Almirall at Venture Finanzas SA.

The product also IS one of a handful of medicines in late- stage development that Forest is counting on for growth. Forest licensed development and marketing rights to aclidinium from Almirall in 2006.

Aclidinium was designed as a long-acting treatment for moderate to severe chronic obstructive pulmonary disease, sometimes called smokers' cough. If approved, it would compete with Spiriva, from closely held Boehringer Ingelheim GmbH and New York-based Pfizer Inc., the world's biggest drugmaker.

The new studies were from the last of three stages of clinical testing generally required for regulatory approval.

Decisions Pending

The companies are working to understand the results, and plan to decide within the next month what steps to take and whether more studies will be needed, Almirall executives said in a conference call with investors today. They had aimed to market the drug in Europe in 2010 and in the U.S. a year later.

Patients on aclidinium had a ``significant difference'' in lung function within 12 weeks compared with those taking a dummy medicine, according to today's statement. One study didn't find a significant improvement in health-related quality of life at one year, and the other didn't show a significant delay in how long patients went before a moderate to severe breathing attack.

The companies said in May that a daily dose of aclidinium significantly increased lung function after 29 days and didn't cause serious side effects in four earlier studies.

Jamie Clark, a London-based analyst at Merrill Lynch, cut his rating on Almirall to ``neutral'' from ``underperform'' and slashed his price target to 10 euros from 14 euros after the statement was released.

``This is disappointing versus both Phase II data and our expectations of equivalent efficacy versus Spiriva,'' Clark said in a note sent to investors.

Expiring Patents

Forest needs new drugs before its top-selling antidepressant Lexapro and its Alzheimer's disease treatment Namenda lose patent protection in 2012 and 2013.

More than 12 million Americans are diagnosed with chronic obstructive pulmonary disease and 12 million more probably have the malady without knowing it, according to the National Heart, Lung and Blood Institute, based in Bethesda, Maryland. Most patients are at least 40 years old and have a history of smoking. Some people get the disease from pollution or genetic factors.

The condition, sometimes called emphysema or chronic bronchitis, causes the airways to become swollen and blocked, making it difficult to breathe. It causes serious, long-term disability and more than 120,000 U.S. deaths each year, according to the government-funded institute.

To contact the reporters on this story: Catherine Larkin in Washington at clarkin4@bloomberg.net; Paul Tobin in Madrid at ptobin@bloomberg.net.

Last Updated: September 3, 2008 16:21 EDT