Few toes tapped as investors heard a familiar tune from Vital Therapies Inc., which said it found encouraging data with a subset of patients in VTI-208, the bombed phase III trial for alcohol-induced liver decompensation (AILD). With $62 million banked, the firm hopes to design a new study based on a narrowed group of prospects. "We think we can do it if we restructure the company," CEO Terry Winters said.

Shares of San Diego-based Vital (NASDAQ:VTL) closed Monday at $3.65, down $14.03, or 79.4 percent, as the market reacted to Friday's news that the experiment testing the firm's cell-based ELAD (extracorporeal liver-assist device) system in AILD missed the primary endpoint of overall survival (OS) through at least 91 days as measured by the Kaplan-Meier method.

Of 203 total subjects enrolled in VTI-208, 96 were randomized to the treated group and 107 to the control arm. The hazard ratio of 1.027 (slightly favoring the control group) with a log rank "p" value of 0.90 showed no difference between treated and control subjects in OS. BTIG Research analyst Sean Lavin said "the big surprise was that there was no survival benefit." In an Aug. 6 report, when he started coverage of Vital with a "buy" rating, Lavin said that "if ELAD works, it could be one of the largest changes in medical mortality in years." Revisiting the company Monday, he sounded less sanguine and noted that his firm "thought if the trial missed its endpoint it would trend towards a benefit, without being statistically significant. In this case, no benefit was seen," a situation for which Lavin could find "no good reason."

The company is still sorting out the matter. Chief medical officer Jan Stange, during a conference call organized late Friday, pointed to the finding in the new data that patients should be left out of the next trial who have acute kidney injury (AKI), defined by serum creatinine greater than 1.5 mg/dl, or who have evidence of severe coagulopathy, defined by an international normalized ratio (INR) score of greater than 2.5. Such a discovery "fits into our proposed mechanism of action," he said. In liver failure, "on the one hand the liver tries to recover, come out of inflammation, and growth hormones try to rebuild the remaining cells. On the other hand, liver failure has the patient more and more slip into secondary organ complications," which is usually what kills them, he said, adding that "medically, [the AKI/high INR patients benefiting less] makes sense to me. The good news is that the population below those parameters is not a tiny subset – more than 50 percent of the population of the trial. I think that's not an accidental finding."

Canaccord Genuity analyst John Newman cited several pre-specified subset analyses of VTI-208 data that suggest ELAD works in basically healthier patients. "Assuming an additional phase III study is conducted for ELAD, we would expect Vital to focus on patients with a MELD [model for end-stage liver disease, devised by the Mayo Clinic] score of less than 28, and exclude patients with AKI and severe coagulopathies," he wrote in a research report. "When examining patients with MELD scores of less than 28, data showed a hazard ratio of 0.575 and p value of 0.077, and a per-protocol analysis showed a p value of 0.059."


Key to ELAD is the VTL C3A cell bank, based on the cell line that Vital acquired from Baylor University. The bank's human liver-derived cells can be stored and shipped worldwide. Apparently the immortal cells can do what ordinary human liver cells do, and nonclinical studies had proven that they retain many of the specific metabolic processes and pathways of hepatocytes, according to Vital, which owns the bank exclusively and royalty-free.

During ELAD therapy, blood is drawn from the patient by way of a central venous line and sent into an ancillary delivery system, where plasma ultrafiltrate is isolated by a generator and then passed into four cartridges to make contact with the VTL C3A cells, but only after it passes through fibers that allow two-way transfers of toxins, metabolites and nutrients, much like the liver does. Heparin is administered in some patients to prevent blood clotting in the cartridge.

Next, the processed plasma ultrafiltrate is filtered again, reconstituted with blood cells, and returned to the patient through the central line.

During the procedure, the delivery system monitors temperature, pH, and oxygen concentrations in the ultrafiltrate to keep the cells viable. ELAD treatment typically lasts three to 10 days, as determined by the physician, and is done in a single continuous session.

In the VTI-208 trial, researchers deliberately cast the net wide, CEO Winters said during the call. U.S. regulators provided "a guidance document that basically encourages you to enrich the patient population in survival studies in order to get a reasonable outcome with a reasonable number of patients," he said. "The bottom line there is that the population you treat in the trial is not necessarily representative of the population that would be appropriate for marketing later."

VTI-210 and VTI-212, ELAD's two other ongoing trials, have been suspended. The latter is an open-label phase II study that is part of a phase II/III program in subjects with either fulminant hepatic failure or surgery-induced liver failure. VTI-210 is a 1:1 randomized, controlled, open-label pivotal trial designed to enroll a minimum of 150 subjects with severe acute alcoholic hepatitis who have failed seven days of treatment according to pre-defined criteria.

Winters said that affording the new phase III experiment with more-restricted entry criteria "depends on what exactly the design of the trial is, how many patients, how fast we think we can enroll, etc. We've also been focusing on doing a lot of other things in preparation for marketing, and we would cease most of those things as well." VTI-210 is "addressing a much sicker patient cohort that would have some of the characteristics of the patients we found did not do as well on ELAD," he said. "Secondly, we simply want to conserve cash while we design the new trial."

Winters was questioned regarding how soon the company might meet with the FDA to figure out next steps. "I can't tell you exactly when that time is," he said. "We have started the process" of setting up a meeting with gatekeepers and will "probably consider another communication with investors" afterward, he told analysts.

Vital went public in April 2014, pricing 4.5 million shares at $12 apiece, below an already downsized range of $13 to $15. Five months later, shares were showing a recovery to the $22 neighborhood, based on advances with the phase III trial. (See BioWorld Today, April 18, 2014, and Sept. 9, 2014.)

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