"We think until we understand it, we shouldn't be throwing more money at allergy," he said. "We need to understand what has gone on and if there is a way of fixing it. We are not going to plough lots of money into something we don’t think has a good chance of success."

He said Circassia would continue to focus "resolutely" on its wider portfolio, increasing sales of its Niox asthma management products and advancing its pipeline of respiratory products.

Circassia has been developing a range of promising new treatments for cat, dust mite, ragweed and grass allergies using its next-generation immunotherapy, called Synthetic Peptide Immuno-Regulatory Epitopes (Spires), originally developed by researchers at Imperial College.

The most advanced of these next-generation immunotherapy medications, and on which the company was depending, was the cat allergy treatment.

Circassia raised £200m when it listed, fetching a valuation of £581m, which many analysts argued was over-valued.

The failed clinical trial, which involved 1,400 patients across 150 centres in the EU, Russia, Canada and the US, will come as a major shock to investors, including star fund manager Neil Woodford, who has a 19pc stake in the company.

It could also have implications for the wider UK biotech industry as Circassia was widely held up as a poster child for the sector.