A late-stage study that was testing an experimental obesity drug by Zafgen Inc has been put on hold by the US Food and Drug Administration (FDA) after death of second person during the trial.

Shares of the company also dropped 7.4% to $5.81 in extended trading after closing down 60% on Wednesday. A complete clinical hold by FDA means all clinical work requested under the company's investigational new drug application has been suspended.

The company on Wednesday said in a statement that a patient receiving the obesity drug, beloranib, had died from a blockage in an artery in the lung.

The company has been testing Zafgen beloranib for a rare genetic eating disorder called Prader-Willi syndrome. The results of the study are expected to come in the first quarter.

Zafgen said it has been working with experts to understand the issue and also to know the reason behind the occurrence of the artery blockages in Prader-Willi syndrome patients.

CEO Thomas Hughes said, “We remain committed to advancing beloranib as a potential new therapy for this underserved patient population”.

Previously in October the company said that a patient had died during the trial of its experimental obesity drug. The cause of death of the patient was unknown. The FDA after learning about two deaths ordered the company to put its clinical trials on hold, citing previously reported blood clotting in ongoing and completed studies.

Zafgen’s experimental drug was also tested to be used as a treatment for other weight-related disorders, such as severe and complicated obesity, and obesity that results from damage to a part of the brain.