Washington Editor

XenoPort Inc. said its Japanese partner Astellas Pharma Inc. terminated a Phase II study of XP13512, a transported prodrug of gabapentin, in patients with painful diabetic neuropathy (PDN) after an analysis showed it was unlikely the trial would reach statistical significance.

XenoPort alerted investors and analysts about Astellas' decision in a conference call about its third-quarter earnings, during which the Santa Clara, Calif.-based firm reported a loss of $24.1 million, or 96 cents per share, compared with a profit of $15.6 million a year ago.

The company's shares (NASDAQ:XNPT) lost $1.86 Thursday, to close at $38.62.

Tokyo-based Astellas gained the rights to develop XP13512 in Japan and five other Asian countries under a November 2005 deal potentially worth $85 million for XenoPort. (See BioWorld Today, Dec. 2, 2005.)

GlaxoSmithKline plc holds co-development and commercialization rights in all other regions of the world under a February 2007 deal, in which XenoPort could garner $640 million. (See BioWorld Today, Feb. 9, 2007.)

GSK is developing XP13512 under the name Solzira as a treatment for PDN and other pain indications, including postherpetic neuralgia and restless legs syndrome (RLS).

The London-based pharmaceutical giant submitted a new drug application to the FDA in September for Solzira as a treatment for RLS based on two Phase III studies that showed the drug was safer and better tolerated than GSK's currently marketed RLS medication Requip (ropinirole) and Boehringer Ingelheim Pharmaceuticals Inc.'s Mirapex (pramipexole dihydrochloride). (See BioWorld Today, Sept. 17, 2008.)

XenoPort CEO Ronald W. Barrett told investors and analysts that GSK advised the firm that Astellas' verdict to stop the PDN Phase II trial would not impact Solzira's neuropathic pain development program.

Analysts remained positive about the drug's future prospects. Although the failure in the Japanese PDN study may cause XenoPort's stock to be weak, said analyst Katherine Xu, of Credit Suisse Securities LLC, the release of data from GSK's studies of Solzira in the first half of next year will provide a "definitive answer" of the drug's potential in neuropathic pain.

Rodman & Renshaw analyst Raghuram Selvaraju said he had not changed his model of XenoPort based on Astellas' decision since he did not assume any future revenue from Asian sales, including Japan, of the drug in PDN.

Selvaraju said in a research note that he expected XenoPort to exercise its co-promotion option with GSK in advance of the approval and launch of Solzira in RLS.

"In our view, the one-time event that could trigger the exercise of this strategically important option may be the formal acceptance of the Solzira NDA, which could occur before the end of 2008," he said, adding that GSK could secure approval for Solzira in RLS in late 2009, assuming a standard review by the FDA.

Astellas' 360-patient eight-week Phase II trial compared three dosages of XP13512 against placebo in patients with PDN, Barrett explained.

The primary endpoint was the change from baseline and pain score rated on a zero to 10 scale, he said.

The trial included an interim analysis conducted by an independent data monitoring committee, the purpose of which was to recalculate the powering requirements for demonstrating efficacy while maintaining blinding of the data, Barrett said.

But, he said, the results of the analysis indicated that the number of required subjects would be prohibitive, and therefore, Astellas decided to terminate the trial. "We are working with Astellas to fully understand these results," Barrett said, noting that the analysis indicated that XP13512 was generally well tolerated with no safety concerns.

It appears that the baseline pain scores in the Japanese PDN population studied were at the low end of the range compared with scores of studies conducted in the U.S. and Europe, he said. In addition, Barrett said, the preliminary analysis indicated a high placebo response.

Those factors may have contributed to the inability to distinguish XP13512 from placebo, "but there may be other factors," he insisted.

Barrett noted that there have been no published PDN studies using pain as an endpoint conducted in Japan. "So we don't have access to other data against which to compare these results," he said.

Analyst Rachel McMinn, of Cowen & Co., noted that PDN studies can be "tricky," as evidenced by multiple failed studies of Pfizer Inc.'s Lyrica (pregabalin) conducted on its path to approval.

Barrett said that Astellas will make a decision about whether to continue the development of XP13512 for PDN in Japan after the two firms have reviewed all of the data and consulted with experts. "It is possible that Astellas could conclude that further investment in PDN in their territory is not warranted," he warned investors and analysts.

However, he emphasized that GSK is moving forward with its program in PDN and other development areas. The next 12 months for XP13512, Barrett told investors and analysts, "will be rich with new data from a number of studies."

In RLS, he said, Solzira holds the potential to be an important alternative to dopamine agonists. In addition, Barrett said, XenoPort's clinical trials in RLS patients indicated other advantages of the drug, such as sleep benefits.

He noted that GSK recently initiated a Phase IIIb polysomnography trial of Solzira with the objective of further exploring the medication's potential sleep benefits.

Beyond RLS, Barrett said, GSK is studying Solzira in three Phase II neuropathic pain studies, including a PDN study that recently completed enrollment, with results expected in 2009.

In addition, GSK recently initiated a large Phase II study of Solzira as a prophylactic treatment for migraines, he said.

Barrett noted that Astellas also is studying XP13512 in RLS and recently completed enrollment of a Phase II study of patients in Japan.

XenoPort's other development programs have "continued to make progress," Barrett said. The firm expects to report top-line results by the end of the year from its Phase II trial of XP19986, a transported prodrug of the R-isomer of baclofen, as a potential treatment for gastroesophageal reflux disease, or GERD, he said.

A Phase II trial of XP19986 in spinal cord injury patients with spasticity remains on track, Barrett added, with top-line data expected in the first half of 2009.

XenoPort also plans to initiate a Phase II study of XP19986 later this year in patients with acute back spasms of neuromuscular origin.

As with XP13512, Barrett said, XP19986 "could become an important new therapy in a number of disorders in which currently available therapies are suboptimal."

Cowen's McMinn called XP19986 XenoPort's "most valuable asset," assuming a positive Phase II outcome.

But, she said, deals outside of the U.S. for the firm's Parkinson's disease drug, XP21279, a transported prodrug of levodopa, and its menorrhagia drug, XP21510, also could provide nondilutive financing for XenoPort.