Promising Results, But It's Still Early

Aeterna Zentaris' (NAS: AEZS) investors got a bit of good news yesterday while they wait for phase 3 data for the company's colorectal cancer drug perifosine. AEZS-108 might serve as a backup compound if perifosine fails. Or better yet, maybe it's a second compound on the market if perifosine succeeds.

Maybe. This was only phase 1 data after all.

The purpose of the phase 1 prostate cancer trial is to figure out the right dose of AEZS-108 to use, but the efficacy data doesn't look too shabby. Half of the patients saw their PSA -- a measure of the severity of the prostate cancer -- go down, and out of the four patients with radiologic disease that could be evaluated, three showed signs of stable disease.

Of course, with any phase 1 trial, you have to keep this in perspective. It's only 10 patients. A lot can happen between now and a phase 3 trial with hundreds.

And even if AEZS-108 gets to the market in a few years, there's plenty of competition ahead of it. The phase 1 trial tested patients with castration and taxane-resistant prostate cancer. Assuming Aeterna Zentaris sticks with that patient population, AEZS-108 wouldn't have to compete with Dendreon's (NAS: DNDN) Provenge, which is used before taxanes. But there'll still be competition from Johnson & Johnson's (NYS: JNJ) Zytiga and Sanofi's (NYS: SNY) Jevtana, which are used later in disease progression. And Medivation's (NAS: MDVN) MDV3100 and Bayer and Algera's alpharadin are also well ahead of AEZS-108 in the prostate cancer space.

Not that competition in the prostate cancer space a few years from now should be investors' biggest worry. Getting perifosine approved by marketing partner Keryx Biopharmaceuticals (NAS: KERX) is the key to Aeterna Zentaris' short- to mid-term success. I think perifosine has a good chance at succeeding, but there are no guarantees in drug development. At least the backup drug will offer some consolation if perifosine's phase 3 data doesn't turn out like investors are hoping.

At the time this article was published Fool contributor Brian Orelli holds no position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool owns shares of Dendreon and Johnson & Johnson. Motley Fool newsletter services have recommended buying shares of and creating a diagonal call position in Johnson & Johnson. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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