OncoGenex scrambles after trial fail
- An experimental drug from OncoGenex Pharmaceuticals failed to improve overall survival in patients with advanced prostate cancer in a late-stage study, prompting the small Bothell, Washington-based company to begin exploring "strategic alternatives."
- OncoGenex said it would ask the Food and Drug Administration to allow an early analysis of data from another Phase 3 trial evaluating the drug against non-small cell lung cancer. That trial is currently scheduled to wrap up in the first half of next year.
- The company has struggled since Teva backed out of a partnership in December 2014, leaving Oncogenex to fund development of the drug, called custirsen. In February, Oncogenex laid off 11 employees, or roughly 27% of its workforce to reduce operating expenses.
OncoGenex, already trading below $1 per share, doesn't have much further to fall, but the trial failure leaves it with limited options and a shrinking cash reserve.
The company had $39.7 million in cash and short-term investments as of June 30, which should be able to fund operations through the third quarter of next year, according to filings with regulators. Having already cut staff to lower costs, OncoGenex wants to open up its Phase 3 ENSPIRIT trial to determine if its worth continuing to fund the study.
"Given that the ENSPIRIT trial has nearly completed enrollment and we believe there are likely a sufficient number of events to determine the effect of custirsen in NSCLC, we are eager to expedite the final data analysis, which would allow us to conserve resources and fully understand the value of the asset as we evaluate our alternatives to maximize shareholder value," said Scott Cormack, CEO of OncoGenex.
OncoGenex had previously been partnered with Teva Pharmaceuticals for the development of custirsen, but Teva exited the collaboration in December 2014. The company has already used up the $27 million it received from Teva under the termination agreement.
With that money gone and nothing in hand after the Phase 3 trial for advanced prostate cancer, Oncogenex will need help to keep going."We will need to acquire additional capital or enter into a new partnership or collaboration agreement to fund additional development or commercialization [of custirsen]," the company said in a filing at the end of the second quarter.
Already Oncogenex is mulling its options, engaging MTS Health Partners as an adviser to help decide on "strategic alternatives." Its stock fell by 39¢, or over 40%, in early trading Tuesday.
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