Readying for another run against amyotrophic lateral sclerosis (ALS) with its fast skeletal muscle troponin activator tirasemtiv, Cytokinetics Inc. heartened Wall Street with strong earnings and what looks like a solid plan for the phase III experiment.

CEO Robert Blum told investors during a conference call that the South San Francisco-based firm had "dedicated much of the second half of 2014" to evaluating the April's failed phase IIb trial and, after consulting with experts and regulators, has decided to go ahead with the next stage.

Cytokinetics' shares (NASDAQ:CYTK) closed Friday at $7.78, up $1.29, or 20 percent.

Tirasemtiv's main endpoint in the 680-patient phase IIb trial known as BENEFIT-ALS (Blinded Evaluation of Neuromuscular Effects and Functional Improvement with Tirasemtiv in ALS) was the mean change from baseline in the ALS Functional Rating Scale (FRS) in its revised form. The outcome was -2.98 points in the tirasemtiv group vs. -2.40 points in the placebo group (p = 0.11). Secondary measures of tirasemtiv's effects on respiratory function and other gauges of skeletal muscle function turned up results that the company described as mixed. (See BioWorld Today, April 28, 2014.)

Blum pointed out at the time that the tirasemtiv study joined a long list of research in which the FRS failed to show a treatment effect, and said there was "much more in those secondary endpoints" worth investigating.

BENEFIT-ALS did turn up statistically significant increases vs. placebo in slow vital capacity or SVC. During the Friday call, Blum emphasized the importance of the measure. "Of course, in a clinical setting, patients with ALS are evaluated in a variety of ways," he said, but respiratory function is especially important since patients usually die from respiratory failure. "Multiple studies have shown that the rate of decline in pulmonary function, as measured by vital capacity, strongly predicts mortality," Blum said, noting that "third-party payers also make decisions about funding such interventions based on vital capacity."

More details about the phase III trial will come later. "We're not going to be communicating the play-by-play on the regulatory interactions throughout the process, but rather when we've got something meaningful and material to share that's when we'll disclose it," Blum said.

Fady Malik, the firm's senior vice president of research and development, said the trial "is going to be designed to confirm the effects that we saw in benefit, obviously, and so the scope of it will be similar." The trial "will be longer, because we'll be looking to extend that effect to extend it out to longer time points, and then also to be able to correlate improvements in the decline of SVC with other respiratory parameters," he added.

Joseph Pantginis, analyst with Roth Capital Partners, was among those who registered their liking for the plan. "As study design is not yet finalized, guidance for study cost has a wide range of $25-$50 million," he wrote in a research report. "With BENEFIT-ALS having cost $35 million to $40 million, we believe cost should be in this range if not somewhat higher, due to the extended study period. We believe that with SVC as the primary endpoint, replicating SVC results from BENEFIT-ALS in the phase III alongside a neutral effect on FRS could be the basis for regulatory filing."

LONGER PRE-DOSING?

Cytokinetics reported total research and development revenues for the fourth quarter of 2014 were $21.8 million, compared to $24.3 million during the same period in 2013. Beating analysts' estimates, net income for the fourth quarter was $8.4 million, or 23 cents per basic and diluted share, compared to a net income for the same period in 2013 of $6.5 million, or 22 cents per basic share and 21 cents per diluted share.

As of the end of last year, the firm had cash, cash equivalents and investments of $83.2 million, which includes $10 million for the sale of common stock to partner Astellas Pharma Inc., of Tokyo, but does not include $45 million more from Astellas last month.

The pair signed their potential $490 million deal to develop skeletal muscle activators in 2013, and the arrangement was expanded in December to include the development of CK-2127107, a fast skeletal troponin activator, in spinal muscular atrophy and potentially other neuromuscular indications. That's where the added $55 million comes from – $30 million as an up-front license fee, $10 million paid for Astellas' purchase of Cytokinetics' common stock, and $15 million in a milestone payment in connection with the decision made by Astellas to advance the new compound into phase II development. (See BioWorld Today, June 26, 2013.)

Although the exact protocols aren't known, Cytokinetics did provide hints about the phase III with regard to "tolerability and early termination that we'd like to improve upon," Blum said.

Andrew Wolff, chief medical officer, offered color.

"Recall that, in BENEFIT-ALS, all patients who met the eligibility criteria received a week of open-label tirasemtiv at a starting dose of 125 mg, twice a day for a week before they were randomized to either tirasemtiv or placebo, and part of the reason for doing that was to ensure that patients would tolerate that before they were randomized," Wolff said. "But I think what we've learned from our investigators that a week is really not long enough to determine that. I think patients and investigators often felt rushed, and because the patients were very interested in getting into the trial, I think we saw too often that a decision was made to randomize the patient only to have them decide relatively shortly thereafter that they really couldn't put up with the adverse events they were experiencing."

Along with Astellas, Cytokinetics has a partnership with Thousand Oaks, Calif.-based Amgen. The pair first joined forces in late 2006. At the time, Amgen paid $42 million in cash and $33 million in equity for the option to license the cardiac muscle contractility program, including omecamtiv, then known as CK-1827452. In 2009, Amgen exercised the option, which triggered a $50 million milestone payment to Cytokinetics. (See BioWorld Today, Jan. 4, 2007, and May 27, 2009.)

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