Shares of Targacept Inc. tumbled in premarket trading Tuesday, a day after the drug developer said it would stop work on an experimental drug that failed in a mid-stage study of schizophrenia patients.

The Winston-Salem, N.C., company said Monday after markets closed that data from the trial helped Targacept leaders decide to stop developing the potential treatment, labeled TC-5619, for either schizophrenia or Alzheimer's disease. Last year, Targacept also said TC-5619 had failed in a mid-stage study as an experimental attention deficit hyperactivity drug.

Researchers tested the drug as a potential treatment for schizophrenia symptoms in patients who were already taking an antipsychotic medicine. Targacept said the drug did not meet its main goal, which involved a change in the assessment of negative symptoms over about six months. TC-5619 also did not lead to an improvement in cognitive function.

The study of 477 patients in Eastern Europe and the United States examined groups taking either one of two doses of the drug or a placebo.

The drug developer said it will now focus on mid-stage studies of potential treatments for overactive bladder and Alzheimer's disease, and it will continue with development plans for a potential diabetic gastroparesis treatment.

Targacept shares sank nearly 33 percent, or $1.95, to $4 in premarket trading about 90 minutes ahead of the opening. The stock had advanced about 36 percent so far this year as of Monday's close.