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Diamyd's Shares Tumble on Phase II Gene Therapy Miss

By Cormac Sheridan
Staff Writer

Shares in Diamyd Medical AB dropped 30 percent Tuesday on news that its gene therapy treatment for cancer pain missed the primary endpoint in a Phase II placebo-controlled trial.

The study, which was conducted in 18 clinical centers across the U.S., found no difference in average pain scores among patients who received a single dose of the treatment, NP2 Enkephalin, (n = 17) and those who received placebo (n = 16).

NP2 Enkephalin comprises a replication-defective herpes simplex virus (HSV) vector encoding human preproenkephalin, which is processed to two different forms of enkephalin, a pentapeptide endorphin that reduces the sensation of pain by signaling via an opioid receptor. The construct exploits the nerve-tissue tropism of HSV to establish a latent, nontoxic infection that is confined to the peripheral nervous system, following administration via the skin.

Patients who had breakthrough cancer pain, despite being on conventional pain therapy, including opiate drugs, were randomly assigned to the treatment arm or to the control arm. The primary endpoint comprised a change from baseline of patient-recorded average daily pain scores from day three through day 14 after treatment.

However, there was no statistical separation between the two arms. In a previous, uncontrolled Phase I trial in 10 patients with cancer pain, who were also on concomitant morphine or equivalent therapy, a clear dose-response effect on pain relief was seen.

"The Phase I study was an open-label study, and it was small, but still, it looked like a dose-dependent effect on pain reduction," Diamyd CEO Peter Zerhouni told BioWorld International. "Now there was nothing – and it was the same drug, the same batch, the same everything." However, patients in that study were permitted to have slightly lower levels of baseline pain at recruitment. "Maybe that played a role," he said.

Animal studies also had provided preclinical proof of concept. "In animals, we've actually seen a synergistic effect when we give them morphine and enkephalin," he said. There was a supporting biological rationale as well. "Enkephalin doesn't hit the same receptor as morphine," Zerhouni said. Enkephalin hits the delta opioid receptor, whereas morphine hits the mu opioid receptor.

Patients in the present study are free to enroll in an open-label extension study, which will involve the administration of up to two additional doses of NP2 Enkephalin. The primary purpose of that study is to gather further safety data, however.

Right now, the company has no ready explanation for the miss. "Was it the indication, or was it the product, or was it the dose or was it the concept of therapeutic gene delivery to the nerves?" Zerhouni asked.

The construct appeared safe, which, Diamyd said, is an important finding for the company's gene therapy platform, Nerve Targeting Drug Delivery System (NTDDS). The same platform is also being deployed in preclinical programs in diabetes pain and chronic pain, which involve the delivery of genes encoding glutamic acid decarboxylase (GAD) and endomorphin, respectively.

"With GAD, we could go into the clinic now," Zerhouni said. "Now we'll have to look at that plan again and see if that's the best thing to do."

Diamyd reported SEK389 million (US$56 million) in cash as of May 31. The company had made its NTDDS platform its main focus since the Phase III failure of its therapeutic vaccine for Type I diabetes, also called Diamyd, and the subsequent loss of its development partner, Johnson & Johnson, of New Brunswick, N.J. (See BioWorld International, June 8, 2011.)

Shares in Diamyd (STOCKHOLM:DIAMB) closed Tuesday at SEK7.35, down SEK3.20.