Positive Phase 2 Study Results for Tivantinib in Previously Treated Hepatocellular Carcinoma to Be Presented at ASCO

  Positive Phase 2 Study Results for Tivantinib in Previously Treated
  Hepatocellular Carcinoma to Be Presented at ASCO

  *Significant improvements in time to progression (TTP) and overall survival
    (OS) observed in patients whose tumors were MET-high
  *Hepatocellular carcinoma (HCC) is the most common primary liver cancer and
    on the rise worldwide ^ 1
  *Phase 3 study among previously treated HCC patients with MET-high tumors
    is currently being planned with tivantinib

Business Wire

WOBURN, Mass. & TOKYO -- June 02, 2012

ArQule, Inc. (Nasdaq: ARQL) and Daiichi Sankyo Co., Ltd. (TSE: 4568) today
announced final results from a randomized, placebo-controlled, double-blind,
phase 2 clinical trial with the selective MET inhibitor tivantinib as a
single-agent, investigational, second-line treatment in hepatocellular
carcinoma (HCC). The data are to be presented today at the 48th Annual Meeting
of the American Society of Clinical Oncology (ASCO) (abstract number 4006).

The 107 patients in the trial had unresectable HCC and had disease progression
after first-line therapy or were unable to tolerate the first-line therapy.
Patients were randomized to receive tivantinib at 360 milligrams (mg) twice
daily or 240 mg twice daily or placebo (2:1 tivantinib:placebo). The primary
endpoint was time to progression (TTP) in the intent to treat (ITT)
population. Other study endpoints were disease control rate (DCR), progression
free survival (PFS), overall survival (OS), as well as safety for the ITT
population and pre-defined MET-high or MET-low cohorts (as defined by
immunohistochemistry).

A statistically significant 56 percent improvement as compared to placebo was
seen in TTP in the ITT population (hazard ratio [HR] = 0.64; log rank p-value
= 0.04). In the MET-high cohort, there were also statistically significant
improvements in TTP, PFS and OS:

  *Median OS in tivantinib arm was 7.2 months and 3.8 months in the placebo
    arm (HR = 0.38; log rank p-value = 0.01)
  *Median TTP was 2.9 months in the tivantinib arm and 1.5 months in the
    placebo arm (HR = 0.43, log rank p-value = 0.03)
  *Median PFS was 2.4 months in the tivantinib arm and 1.5 months in the
    placebo arm (HR = 0.45, log rank p-value = 0.02).

Adverse events were reported at similar rates in the treatment and placebo
arms of the trial, except for a higher incidence of fatigue and hematologic
events, including neutropenia and anemia, in tivantinib-treated patients. The
incidence of hematologic events decreased following dose reduction of
tivantinib from 360 mg twice daily to 240 mg twice daily. Due to the incidence
of neutropenia in the 360 mg treatment group, the tivantinib dose was reduced
to 240 mg twice daily for all patients.

“Patients living with this disease need more options to slow progression. The
findings from this tivantinib study represent the first randomized data
reported in HCC with an investigational MET inhibitor, as single-agent therapy
in second-line treatment,” said Lorenza Rimassa, Deputy Director, Medical
Oncology Unit, Humanitas Cancer Center, Milan, Italy. “The data suggest that
patients significantly benefited in time to progression and, importantly,
those in a biologically relevant MET-high subgroup had an additional
significant advantage in overall survival.”

“Research has shown that MET is a signaling pathway associated with poor
outcomes in many cancers, including liver cancer and non-small cell lung
cancer (NSCLC),” said Glenn Gormley, MD, PhD, Global Head of Research &
Development and Senior Executive Officer, Daiichi Sankyo Co., Ltd. “The strong
overall survival results among HCC patients in this trial whose tumors were
MET-high reinforce this previous research that defines MET as a critical
pathway in cancer as well as the activity of tivantinib as a MET inhibitor.”

About Hepatocellular Carcinoma (HCC)

Globally, liver cancer is the sixth most common cancer (749,000 new cases),
accounting for 7 percent of all cancers, and is the third cause of cancer
related death (692,000 cases).^2 HCC represents more than 90 percent of
primary liver cancers.^3 Chronic hepatitis B and C are recognized as the major
factors worldwide increasing the risk of HCC, with risk being even greater in
the presence of co-infection with these viruses.^4 Cirrhosis is also a risk
factor for development of HCC.

About Tivantinib and the MET pathway

Tivantinib is an orally administered, selective inhibitor of MET, a receptor
tyrosine kinase. In healthy adult cells, MET is present in normal levels to
support natural cellular function, but in cancer cells MET is inappropriately
and continuously activated for unknown reasons. When abnormally activated, MET
plays multiple roles in aspects of human cancer, including cancer cell growth,
survival, angiogenesis, invasion and metastasis.

Tivantinib is currently in phase 3 development and has not yet been approved
for any indication. Tivantinib has the potential to be a first-in-class MET
inhibitor for the treatment of non-small cell lung cancer (NSCLC) and is
currently being studied for other indications including liver and colorectal
cancers.

About ArQule and Daiichi Sankyo Co., Ltd.

In December 2008, ArQule and Daiichi Sankyo signed a license, co-development
and co-commercialization agreement for tivantinib (ARQ 197) in the U.S.,
Europe, South America and the rest of the world, excluding Japan, China
(including Hong Kong), South Korea and Taiwan.

About ArQule

ArQule is a biotechnology company engaged in the research and development of
next-generation, small-molecule cancer therapeutics. The Company’s targeted,
broad-spectrum products and research programs are focused on key biological
processes that are central to human cancers. ArQule’s lead product candidate,
in phase 2 and phase 3 clinical development together with development and
commercialization partner, Daiichi Sankyo, Co. Ltd., is tivantinib, an oral,
selective inhibitor of the MET receptor tyrosine kinase. The Company’s
pipeline consists of ARQ 621, designed to inhibit the Eg5 kinesin motor
protein, and ARQ 736, designed to inhibit the RAF kinases. ArQule’s current
discovery efforts, which are based on the ArQule Kinase Inhibitor Platform
(AKIP™), are focused on the identification of novel kinase inhibitors that are
potent, selective and do not compete with ATP (adenosine triphosphate) for
binding to the kinase.

About Daiichi Sankyo

The Daiichi Sankyo Group is dedicated to the creation and supply of innovative
pharmaceutical products to address the diversified, unmet medical needs of
patients in both mature and emerging markets. While maintaining its portfolio
of marketed pharmaceuticals for hypertension, hyperlipidemia, and bacterial
infections, the Group is engaged in the development of treatments for
thrombotic disorders and focused on the discovery of novel oncology and
cardiovascular-metabolic therapies. Furthermore, the Daiichi Sankyo Group has
created a "Hybrid Business Model," which will respond to market and customer
diversity and optimize growth opportunities across the value chain. For more
information, please visit www.daiichisankyo.com.

This press release contains statements regarding the clinical trials with
tivantinib (ARQ 197) by ArQule and its business partner, Daiichi Sankyo.These
statements are based on the current beliefs and expectations of both
companies, and are subject to risks and uncertainties that could cause actual
results to differ materially.Positive information about pre-clinical and early
stage clinical trial results does not ensure that later stage or larger scale
clinical trials will be successful. For example, tivantinib may not
demonstrate a promising therapeutic effect; in addition, it may not
demonstrate an appropriate safety profile in current or later stage or larger
scale clinical trials as a result of known or as yet unanticipated side
effects. The results achieved in later stage trials may not be sufficient to
meet applicable regulatory standards or to justify further development.
Problems or delays may arise during clinical trials or in the course of
developing, testing or manufacturing these compounds that could lead ArQule or
its partners to discontinue development.Even if later stage clinical trials
are successful, unexpected concerns may arise from analysis of data or from
additional data.Obstacles may arise or issues may be identified in connection
with review of clinical data with regulatory authorities. Regulatory
authorities may disagree with ArQule’s view of the data or require additional
data or information or additional studies.In addition, the planned timing of
initiation and completion of clinical trials for tivantinib are subject to the
ability of ArQule, Daiichi Sankyo, and Kyowa Hakko Kirin, a licensee of
tivantinib, to enroll patients, enter into agreements with clinical trial
sites and investigators, and overcome technical hurdles and other issues
related to the conduct of the trials for which each of them is
responsible.There is a risk that these issues may not be successfully
resolved.Drug development involves a high degree of risk. Only a small number
of research and development programs result in the commercialization of a
product.Positive pre-clinical data may not be supported in later stages of
development.Furthermore, ArQule may not have the financial or human resources
to successfully pursue drug discovery in the future. Moreover, with respect to
partnered programs, even if certain compounds show initial promise, Daiichi
Sankyo or Kyowa Hakko Kirin may decide not to license or continue to develop
them, as the case may be.In addition, Daiichi Sankyo and Kyowa Hakko Kirin
have certain rights to unilaterally terminate their agreements with ArQule. If
either company were to do so, ArQule might not be able to complete development
and commercialization of the applicable licensed products on its own. For more
detailed information on the risks and uncertainties associated with ArQule’s
drug development and other activities, see ArQule’s periodic reports filed
with the Securities and Exchange Commission. Neither ArQule nor Daiichi Sankyo
undertake any obligation to publicly update any forward-looking statements.

^1 Hepatocellular carcinoma: Epidemiology, risk factors and pathogenesis.
World Journal of Gastroenterology 14(27): 4300-08, 2008.
^2 EASL–EORTC Clinical Practice Guidelines: Management of hepatocellular
carcinoma. Journal of Hepatology. 2012;56: 908-943
^3 EASL–EORTC Clinical Practice Guidelines: Management of hepatocellular
carcinoma. Journal of Hepatology. 2012;56: 908-943
^4 Chiaramonte M, Stroffolini T, Vian A, et al.: Rate of incidence of
hepatocellular carcinoma in patients with compensated viral cirrhosis. Cancer
85 (10): 2132-37, 1999.

Contact:

ArQule
William B. Boni, 781-994-0300
VP, Investor Relations/Corp. Communications
www.ArQule.com
or
Daiichi Sankyo, Co., Ltd.
Dr. Michaela Paudler-Debus, +81-3-6225-1338
or
Daiichi Sankyo, Inc. (US)
Kimberly Wix, 973-944-2338
908-656-5447 (mobile)
 
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