2 High-Flying Biotechs Face a New Hurdle

The bar for late-stage colon cancer patients has been set at a whopping 1.4-month increase in survival. This incremental improvement by Bayer and Onyx Pharmaceuticals' (NAS: ONXX) regorafenib is nothing to get excited about, but it should be enough to get the drug on the market; patients that didn't get the drug only lived five months, so it's meaningful, just not spectacular.

The standard will have an effect on the much-anticipated results from Aeterna Zentaris (NAS: AEZS) and Keryx Biopharmaceuticals' (NAS: KERX) colon cancer trial for perifosine, which is expected to read out this quarter. Just keep in mind that when comparing two clinical trial results, there are always caveats:

  • The trials didn't enroll identical patients. The perifosine trial requires patients to have failed at least three regimens: a chemotherapy plus Sanofi's Eloxatin; a chemotherapy plus Pfizer's Camptosar; and then either Bristol-Myers Squibb (NYS: BMY) and Eli Lilly's Erbitux or Amgen's (NAS: AMGN) Vectibix. The latter two are an either/or situation because they work under the same mechanism: binding to the epidermal growth factor receptor, or EGFR. The patients could have also gotten Roche's Avastin, but weren't required to. The trial for regorafenib enrolled patients that had exhausted all options, so they were theoretically in worse shape.

  • Overall survival of the control group might be different. The median overall survival will be determined by numerous factors. In addition to the aforementioned difference in the progression of the disease, the control group in the regorafenib group got the best supporting care while the perifosine trial will compare perifosine in combination with Roche's Xeloda to Xeloda alone. The regorafenib trial also was stopped early after an interim look at the data made it clear the drug was working, which might have affected the overall survival. All that being said, Aeterna Zentaris is guiding for survival of five to six months in the control group with an improvement to seven to eight months for patients taking perifosine, which is pretty close to what Bayer and Onyx saw.

  • Side effects matter, a little. Even if all of the above were equal, perifosine might have a chance to beat regorafenib in the side-effect category. Regorafenib caused a series of adverse events including sores on the hands and feet and gastrointestinal problems. I don't think they'll be enough to keep regorafenib off the market -- survival usually trumps side effects for cancer drugs -- but they may sway doctors from the drug if something works just as well, but with a cleaner side-effect profile.

Beating regorafenib is important for perifosine's commercial success, but the number-one concern for Aeterna Zentaris' and Keryx's investors should be whether the drug passes its clinical trial. Doing that and getting on the market will be enough to generate some revenue and drive the value of the companies.

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