Assistant Managing Editor

Sangamo BioSciences Inc. reported promising early data from its Phase II trial of zinc finger protein therapeutic SB-509, showing that it improved muscle function in amyotrophic lateral sclerosis patients, though it remains to be seen whether those results will translate into a win for the company down the road.

At least for now, Wall Street appears to be holding out for more. Shares of Sangamo (NASDAQ:SGMO) gained only a modest 17 cents on the news, closing Wednesday at $5.21.

But analyst Charles Duncan, of JMP Securities, said the preliminary ALS data offer proof of the drug's biological activity. "We view this as a further indication of SB-509's therapeutic potential across multiple disease types," he wrote.

Data from the open-label, repeat-dosing study, presented at the International Symposium on ALS/MND in Berlin, came from the first 22 patients treated at zero and 90 days with intramuscular SB-509, a transcriptional activator of vascular endothelial growth factor-A. Manual muscle testing (MMT) showed that 32 percent of treated subjects in the first cohort (six of 19) demonstrated an improvement in muscle function as assessed by an overall positive slope in their MMT score from day zero to day 120. That compares to 17 percent (26 of 153 patients) from historical controls.

A subset of five patients with improvement in MMT slope across all visit days also showed parallel improvement in one or more of the other endpoints, including the Revised ALS Functional Rating Scale (ALSFRS-R), the primary endpoint of the 45-patient study. MMT, a test of muscle strength, is one of the trial's secondary endpoints, along with forced vital capacity and survival.

Because so little of the Phase II data presented pertained to the ALSFRS-R endpoint, Brean Murray Carret & Co. analyst Jonathan Aschoff wrote in a research note that Sangamo was "data dredging," and wondered "why only five of the eight MMT-benefitting patients were included in this primary endpoint analysis."

He also pointed to a possible repeat of the company's Phase II miss in diabetic nerve damage last year. In that study, SB-509 failed to hit the primary endpoint of improving nerve function and nerve health compared to placebo in patients with diabetic neuropathy, catching investors by surprise since preliminary data had hinted at efficacy. (See BioWorld Today, Nov. 12, 2008.)

Further analysis of the DNA trial, reported in October, showed that SB-509 statistically significantly increased intraepidermal nerve fiber density.

But for Sangamo, its internal pipeline has been overshadowed by the company's platform technology, which has formed the basis of several lucrative partnerships with firms such as Indianapolis-based Dow AgroSciences LLC and Sigma-Aldrich Corp.

The company recently expanded its deal with St. Louis-based Sigma-Aldrich to include exclusive rights to develop and distribute zinc finger DNA-binding protein-modified cell lines for commercial production of protein pharmaceuticals. That deal called for Sangamo to receive an initial $20 million - $15 million in cash and $5 million in equity - plus commercial milestones and royalties.

And in October, the company received a four-year $14.5 million grant from the California Institute for Regenerative Medicine to develop an AIDS-related lymphoma therapy based on its zinc finger nuclease gene-editing technology in stem cells.

As of Sept. 30, Sangamo had cash totaling $47.9 million, though it padded its account with another $20.9 million a few weeks later. Given the firm's cash position and payments from Sigma-Aldrich, analyst Liana Moussatos, of Wedbush PacGrow Life Sciences, is projecting cash runway to profitability in 2012.

In other news from the Berlin conference:

• Avanir Pharmaceuticals Inc., of Aliso Viejo, Calif., reported additional data from the subset of patients with amyotrophic lateral sclerosis enrolled in its confirmatory Phase III STAR trial of Zenvia (dextromethorphan/quinidine) vs. placebo in pseudobulbar affect secondary to ALS or multiple sclerosis. In the ALS subset, both Zenvia 30/10 mg and 20/10 mg met the primary efficacy endpoint by significantly reducing daily PBA episode rates compared to placebo. Avanir reported top-line results from the study in August. (See BioWorld Today, Aug. 12, 2009.)

• Knopp Neurosciences Inc., of Pittsburgh, reported Phase II results showing that KNS-760704, a low molecular weight benzothiazole, was found to be safe and well tolerated in amyotrophic lateral sclerosis patients for up to nine months. In the first part of the study, the drug showed a dose-dependent trend in slowing the rate of disease progression, as measured by the difference in slopes of ALS Functional Rating Scale-Revised across treatment groups, with the greatest benefit observed in the 300-mg dose group. Data from the second part of the study also showed dose-dependent trends, as well as a trend toward survival benefit in the 300-mg group compared to the 50-mg group.

Published  December 10, 2009