Demonstrating a 40 percent response rate in high-grade cervical dysplasia patients, Stressgen Biotechnologies Corp.'s lead candidate, HspE7, appears to be heading toward another Phase III trial.

The San Diego-based company said the positive Phase II data, with hopefully more to come in mid-2005, will guide its late-stage development plans for the drug in treating cervical dysplasia, also called cervical intraepithelial neoplasia. HspE7 targets cells that have human papillomavirus (HPV).

"These are guys that can transform into cervical cancer or anal cancer or 40,000 head and neck cancers every year," said Dan Korpolinski, president and CEO of Stressgen.

In order to avoid the risk of developing cancer, cervical dysplasia patients often undergo a standard surgery known as Loop Electrocautery Excision Procedure (LEEP). The Phase II trial studied HspE7 in 21 patients with high-grade cervical dysplasia who were scheduled to undergo LEEP. Doctors treated patients with a 500-mg dose of HspE7, then performed LEEP two months later, removing the area in which the HPV-infected cells lived. Doctors performing LEEP found that 40 percent of patients who received HspE7 no longer had high-grade dysplasia and probably did not need the surgery.

Another important part of the study assessed the ability of HspE7 in stimulating the immune system to attack HPV. Researchers drew blood from 14 patients and found the results they were looking for in nine of them.

"Sixty-four percent of those patients they did peripheral blood testing on for immunological effect demonstrated they had a specific immunological response," Korpolinski told BioWorld Today.

Norris Comprehensive Cancer Center of the University of Southern California in Los Angeles sponsored the Phase II trial. Stressgen expects to have data available from several other cervical dysplasia studies in mid-2005. The company plans to conduct a Phase III program testing HspE7 in recurrent or residual high-grade dysplasia in women who have failed to achieve an adequate response with LEEP. About 13 percent of high-grade dysplasia patients fail on the LEEP surgery.

"Usually further LEEP procedures do not cure the problem, so these 13 percent of patients remain at high risk for cervical cancer, so that's a group we could go after with this drug," Korpolinski said.

Stressgen intends to move the program forward with a partner focused on the whole area of high-grade dysplasia. If the company needed to go forward alone, it likely would focus only on the smaller population of those who have failed LEEP.

Before starting a Phase III program in cervical dysplasia, Stressgen expects to start one in the initial HspE7 indication, recurrent respiratory papillomatosis (RRP).

"We intend to start the pivotal trial for RRP around June next year," Korpolinski said. "So that's our total focus for the moment."

The company is moving forward by itself with HspE7 in the RRP indication, following positive Phase II results released earlier this year. Korpolinski said a biologics license application is slated for mid-2007. The RRP indication represents a small worldwide market of about $150 million to $175 million annually, but it is a serious condition for which Stressgen has both orphan drug and fast-track status.

RRP occurs in infants when HPV is passed onto them by their mothers.

"This is when the little guys come down a birth canal, and the mother has genital warts that migrate and go in the larynx of the baby," Korpolinski said. "It impedes their breathing. They undergo five to 20 surgeries a year, and it doesn't go away."

By going initially for the smaller RRP indication, Stressgen hopes to gain approval, and then eventually expand the drug into the larger cervical dysplasia population.

Korpolinski said the market size for all of the HPV indications could be well over $1 billion.

"It's a huge market," he said. "The direct cost is $1.6 billion for cervical dysplasia in the U.S. Pap tests cost about $6 billion a year in this country. There is no therapeutic intervention except surgery."

The positive Phase II results of HspE7 in cervical dysplasia overshadow mixed results reported in February in anal dysplasia. In that non-pivotal Phase III trial in 133 patients, the drug did not meet its primary endpoint as measured by adjudicated pathological assessment of biopsies. The pathologists were looking for a downgrade of dysplasia at the six-month mark. However, there was a 28 percent discordance among the pathologists that read the biopsies. (See BioWorld Today, Feb. 26, 2004.)

The anal dysplasia study was a surrogate trial for the cervical dysplasia indication, and it did show some positive results, such as efficacy in 43 percent of patients. Korpolinski said the company learned to design future trials with a "safer endpoint because of the variability in pathology."

HspE7 is a CoVal fusion therapeutic vaccine to treat diseases caused by HPV. It's estimated that at least 20 million people in the U.S. are infected. The infection can result in genital warts and precancerous conditions, such as cervical and anal dysplasia.

Stressgen's CoVal fusion proteins are formed by using recombinant technology to covalently link a stress protein with a protein antigen, which then triggers the immune system to recognize that antigen.

Stressgen's stock (TSE:SSB) rose 20.5 percent, or C8 cents on Wednesday, to close at C47 cents (US$0.39).