Agennix AG (AGX) shares declined as much as 79 percent in Frankfurt trading after an experimental treatment for lung cancer failed to meet targets in a late-stage trial, threatening the company’s survival.
Talactoferrin, a replica of the human protein lactoferrin, didn’t meet its primary endpoint of improving overall survival, Agennix said in a statement yesterday. The drug also didn’t meet a secondary goal of delaying or stopping the disease from progressing and the company is stopping another trial of the drug in the U.S. as a result, Rajesh Malik, chief medical officer, said during a conference call today.
The biotech company is considering all options, including winding down operations, Chief Financial Officer Torsten Hombeck said during the call. He said it’s premature to talk about the company’s other products, which are in the early stages of development.
“The talactoferrin story is over,” Igor Kim, an analyst with Close Brothers Seydler Research AG in Frankfurt, said in an interview. He said Agennix’s best option is to merge with another company, similar to Sygnis Pharma AG (LIOK)’s tie-up with Genetrix’s X-Pol subsidiary following the failure of its main program, an experimental stroke treatment. He cut his recommendation on Agennix to sell from hold today.
Agennix dropped 73 percent to 49 cents at 3:46 p.m., giving the company a market value of 25 million euros ($31 million). The stock’s intraday decline was the biggest since 2009, when the company was created through a merger of GPC Biotech AG and Agennix.
The main trial, called Fortis-M, involved 720 patients worldwide whose non-small cell cancer hadn’t responded to two previous therapies. Another trial, called Fortis-C, enrolled 100 patients in the U.S. and was testing the drug as an early treatment in lung cancer patients.
The company, which is based in the Munich suburb of Martinsried, is taking “immediate steps” to conserve cash as it studies its options, Hombeck said. More data from the trials will be coming in over the next few weeks and must be analyzed, he added.
Positive data would have been “transformative” for the company, Malik said in an interview in July. Agennix’s only other products are RGB-286638, in early-stage testing for cancer, and a topical gel form of talactoferrin for diabetic foot ulcers, also still in an experimental phase.
Lung cancer is the most prevalent type of tumor, with 1.6 million people diagnosed in 2008 and more than half of new cases in developing countries, according to Cancer Research U.K. In the U.S. there will be an estimated 226,160 new cases diagnosed this year and 160,340 deaths, the leading cause of cancer fatalities there, according to the American Cancer Society.
Drugs approved for treatment include Roche Holding AG (ROG)’s Avastin and Tarceva and Eli Lilly & Co.’s Alimta.
Talactoferrin is an immunotherapy, which stimulates a person’s immune system to fight off disease. The Agennix treatment, administered as a drinkable liquid, targets dendritic cells, a type of white blood cell, in the gut. The drug is designed to prompt the dendritic cells to identify tumor cells as invaders and signal the immune system to destroy them.
Median overall survival for patients in the study who got talactoferrin was 7.5 months compared to 7.7 months for placebo, Agennix said in reporting the trial results.
The company said on July 30 that it won a U.S. patent for talactoferrin’s use in non-small cell lung cancer and renal cancer in combination with other care, including chemotherapy, radiotherapy and surgery.
“Harnessing the body’s immune system is very promising,” Malik said in the July 17 interview. “There’s nothing like using your own immune system to attack your own tumor.”
The company stopped a study in February of talactoferrin for severe sepsis because more patients receiving the treatment died than those who got a placebo.
Agennix’s biggest shareholder is Dievini Hopp BioTech Holding GmbH, owned by SAP AG (SAP) co-founder Dietmar Hopp. Chief Financial Officer Hombeck said in July that the company had enough cash to continue operating through the middle of the fourth quarter and is looking at selling either more shares or debt to fund increased spending into 2013.
Hopp was “very disappointed and surprised” by the results, Hombeck said.
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