Managing Editor

Puma Biotechnology Inc. padded into the cancer space with a $55 million private placement, a reverse merger and an in-licensing deal that brings it a late-stage breast cancer candidate.

But its story – even down to its name and logo – will sound like a familiar one to anyone who's followed biotech over the past several years. Its founder, Alan Auerbach, previously formed Cougar Biotechnology Inc., a development-only company that made a success story of the much-maligned reverse merger model and worked on prostate cancer drug abiraterone until its 2009 acquisition by Johnson & Johnson for nearly $1 billion. (See BioWorld Today, May 26, 2009.)

J&J later went on to win approval of abiraretone, branded Zytiga, for use in combination with prednisone in men with metastatic castration-resistant prostate cancer. (See BioWorld Today, April 29, 2011.)

Clearly subscribing to the if-it's-not-broken-don't-fix-it credo, Auerbach looks to be employing the same game plan for his new venture, starting by taking the new firm public via a reverse merger, combining Puma with Innovative Acquisitions Inc. The firm has not yet disclosed its ticker or where it will be listed, and Puma execs could not be reached for comment by press time, but Cougar started out on the Over-the-Counter Bulletin Board and made the leap to Nasdaq a year and a half later. In the three years prior to its buyout, the firm's shares skyrocketed nearly 150 percent, largely on strong abiraterone data.

Whether Puma will achieve that same success remains to be seen. Still, there are other similarities to Cougar's development. Like SRKP 4 Inc., the firm that Cougar merged into back in 2006, Innovative Acquisitions was created specifically as a public shell, meaning that it comes with none of the holdovers from a failed business and Puma stockholders hold 100 percent of the equity. (See BioWorld Today, April 10, 2006.)

Those shareholders, too, comprise some familiar names. Leading Puma's $55 million private placement – the firm sold about 14.7 million shares priced at $3.75 each – was Adage Capital, with participation from Brookside Capital, H&Q Healthcare Investors, H&Q Life Science Investors, Jennison Associates LLC, Orbimed Private Investments IV and funds managed by T. Rowe Price Associates Inc. Nearly all had invested previously in Cougar.

That funding will go toward developing Puma's first compound, neratinib, a panHER inhibitor out-licensed following a pipeline review at New York-based Pfizer Inc. Terms of the licensing deal were not disclosed, but Los Angeles-based Puma is picking up full responsibility for global development and commercialization for the compound in exchange for milestone payments and royalties.

Neratinib is an irreversible tyrosine kinase inhibitor designed to block signal transduction through the epidermal growth factor receptors, ErbB1 (EGFR), ErbB2 (HER2) and ErbB4 (HER4) kinases. It demonstrated promising activity in early clinical trials, and Pfizer has two trials ongoing: a Phase II trial, which is testing the drug in combination with paclitaxel against Herceptin (trastuzumab, Roche AG) plus paclitaxel in previously untreated HER2-positive metastatic breast cancer patients, and a Phase III study investigating neratinib after adjuvant Herceptin in early stage breast cancer patients.

But Puma plans to wind down both of those trials, shifting the focus of neratinib development to HER2-positive metastatic breast cancer patients who have received prior lines of Herceptin-based therapy, the indication that so far has proved the most promising.

The company aims to start trials in that patient population in the first half of next year.