No news proved to be bad news for Exelixis Inc., which saw its shares drop 39.4 percent Wednesday after reporting that its phase III COMET-1 study of Cometriq (cabozantinib) will have to continue to its final analysis, disappointing investors who had hoped for the same early success seen with recently approved drugs in the prostate cancer space.

Shares (NASDAQ:EXEL) fell $2.54 to close at $3.90, with trading volume 16 times above average, as analysts consider the prospects of cabozantinib in prostate cancer.

Heading into the interim analysis, cabozantinib, or “cabo,” faced a high bar set by prostate cancer competitors Xtandi (enzalutamide, Astellas Pharma Inc. and Medivation Inc.), Zytiga (abiraterone, Janssen Pharma Inc.) and Xofigo (radium Ra 223 dichloride, Bayer AG) all of which hit their primary endpoints at interim analysis in prostate cancer studies. While cabo still could hit its primary endpoint of overall survival (OS) at the final analysis, expected later this year, several analysts pointed out that the lack of a futility analysis in the independent data monitoring committee’s (IDMC) interim review might not bode well.

“[So] it is not known whether at least a positive trend on OS was seen,” noted analyst Lee Kalowski, of Credit Suisse, in a research report. He added, “It’s difficult to see how COMET-1 success hasn’t become even more challenging now.”

South San Francisco-based Exelixis provided only limited information, stating that the IDMC conducted its interim review after the event-driven trial hit 387 events and recommended that the study proceed. COMET-1 has finished enrolling 960 patients with metastatic castration-resistant prostate cancer (mCRPC) who have progressed after treatment with docetaxel, Zytiga and/or Xtandi.

Analysts have been cautious about ascribing too high a probability of success to the study. In a research note last month, Jefferies analyst Biren Amin said he doesn’t “expect the trial to achieve [statistical significance] because we believe it’s underpowered.” The trial, which is designed to have a 90 percent power to detect a 25 percent reduction in the risk of death at the final analysis at 578 events, is based on the company’s “aggressive” estimate of a seven-month OS for the control prednisone arm.

“We believe the control arm could observe eight to nine months and don’t anticipate cabo OS exceeding 10 months,” Biren wrote.

Another risk is that multikinase inhibitors haven’t fared well against CPRC in the past. Sutent (sunitinib, Pfizer Inc.), for example, failed in a phase III prostate cancer study in 2010. That drug targets platelet-derived growth factor, VEGFRs and KIT. (See BioWorld Today, Sept. 29, 2010.)

Exexilis’ cabo is designed to inhibit tumor growth, metastasis and angiogenesis by targeting MET, VEGFR2 and RET.

According to Cortellis Clinical Trials Intelligence, COMET-1 completed enrollment in September of mCRPC patients with bone-dominant disease, with subjects randomized on a 2-to-1 ratio to receive either cabo 60 mg daily or prednisone 5 mg twice daily, along with matching placebo. The study’s secondary endpoint is bone scan response, as assessed by an independent radiology facility.

Leerink Swann’s Michael Schmidt wrote in a research note late Tuesday that he continues “to remain cautious on final COMET-1 data in 2014 and estimate[s] a 50 percent probability of success.”

CROWDED MARKET

Even if Exelixis’ drug hits the OS endpoint, it will still have to contend with one of the newest entrants in the prostate cancer space: Xofigo, which gained approval in castration-resistant prostate cancer last year, three months ahead of its PDUFA date, and earned a $2.9 billion buyout bid for developer Algeta ASA by partner Bayer AG. (See BioWorld Today, May 16, 2013, and Dec. 20, 2013.)

An alpha particle-emitting radioactive therapeutic agent, Xofigo was based on interim data showing a median survival of 14 months vs. 11.2 months for placebo. Results also showed that patients in the Xofigo arm were less likely to suffer serious fractures or spinal cord compression, with a median time to first skeletal-related event of 13.6 months for the treatment arm vs. 8.4 months for placebo. (See BioWorld Today, Sept. 27, 2011.)

That study was stopped early, based on those positive data from the interim analysis, with Xofigo following in the footsteps of Zytiga and Xtandi, both of which are duking it out in the post-chemotherapy prostate cancer market and are soon set to spar in pre-chemo patients, too.

Zytiga, an androgen biosynthesis inhibitor administered with prednisone, was approved initially for mCRPC in 2011, based on data from a halted phase III study that met its OS endpoint at the interim analysis. In 2012, the drug gained approval for use in mCRPC patients prior to chemotherapy, again based on impressive interim data. (See BioWorld Today, April 29, 2011, and Dec. 14, 2012.)

Xtandi studies also were halted after primary endpoints were reached at the interim stage. The once-daily, oral androgen receptor signaling inhibitor, gained approval in mCRPC patients post-chemotherapy in 2013, and partners Medivation Inc. and Astellas Pharma Inc. submitted a supplemental new drug application earlier this month to expand the drug’s label to the pre-chemo indication. (See BioWorld Today, Sept. 4, 2012, and March 19, 2014.)

In addition to COMET-1, Exelixis is evaluating cabo in COMET-2, a study enrolling 246 mCRPC patients, with pain palliation as the primary endpoint, selected after the company was unable to agree with the FDA on a special protocol assessment using composite endpoints of pain reduction and bone scan response. (See BioWorld Today, Nov. 2, 2011.)

OTHER STUDIES

The same day it disclosed the IDMC’s recommendation for COMET-1, Exelixis reported that cabo had gained European Commission approval to treat adults with progressive, unresectable locally advanced or metastatic medullary thyroid carcinoma (MTC). The FDA approved the drug for MTC in 2012. (See BioWorld Today, Nov. 30, 2012.)

MTC, however, is expected to bring in only modest revenues for the company – fourth quarter sales totaled only $4.3 million. Near-term commercial potential is hanging on the larger prostate cancer market, though the firm also has ongoing phase III programs testing cabo against renal cell carcinoma and hepatocellular carcinoma.

Exelixis inked a distribution deal for cabo in MTC with Swedish Orphan Biomedical in the European Union; otherwise, it retains sole ownership of the program. The drug had been twice-partnered, first as part of a six-year option agreement with Glaxosmithkline plc, which passed on the compound in 2008. Then Bristol-Myers Squibb Co., which had picked up cabo as part of a deal a few months later, handed rights back in 2010. (See BioWorld Today, Oct. 24, 2008, and Dec. 15, 2008.)

Exelixis continued to advance cabo and realigned its business strategy to concentrate its resources on that program alone.

The good news for Exelixis is that it remains well capitalized. As of Dec. 31, 2013, the firm had about $415.9 million on its balance sheet.