Isis Pharmaceuticals Inc

In a stunning setback, Isis Pharmaceuticals said Wednesday that its leading new drug candidate--a novel medication for treating Crohn's disease--proved ineffective in a just-completed trial in 300 patients. The Carlsbad biotechnology firm is now planning a major restructuring of its operations, including an undetermined number of layoffs among its 400 employees, with the goal of cutting its expenses in half.

Isis Pharmaceuticals Inc. of Carlsbad has won approval to sell the first of a new kind of drug that treats disease by switching off genes. The drug, Vitravene, slows down a serious eye infection that can blind people with AIDS. The approval by the Food and Drug Administration cheered researchers who have spent three decades trying to prove that such treatments were possible.

Six years ago, scientist Kevin Anderson forged a new molecule that promised to slow the progress of an AIDS-related disease that causes blindness. But he had little cause to celebrate back then. It's extremely rare for a molecule that shows potential in the lab to prove itself safe and effective in prolonged tests on patients.