Washington Editor

Although results of a Phase III study of NPS Pharmaceutical Inc.'s investigational drug for short bowel syndrome (SBS) showed promise for patients receiving a low dose of the compound, the product failed to meet its primary endpoint.

News of the study's mixed results sent shares of NPS (NASDAQ:NPSP) tumbling $1.47 Thursday, or 26 percent, to close at $4.21.

Last month, the Bedminster, N.J.-based firm announced that it had granted the rights to develop and commercialize Gattex (teduglutide) outside North America to Nycomed. The Zurich, Switzerland-based firm agreed to pay NPS $35 million up front, of which $25 million was scheduled to be paid within two weeks after the release of the Phase III SBS trial results. (See BioWorld Today, Sept. 27, 2007.)

Nycomed could not be reached Thursday for comment about the study results.

Earlier this week, NPS announced that it was going to use the $30 million paid to the firm by AstraZeneca plc under an agreement to end a partnership on another investigational compound to bolster its development program for Gattex and other late-stage products. (See BioWorld Today, Oct. 10, 2007.)

In a conference call Thursday, NPS CEO Tony Coles assured investors that, despite the mixed results of the Phase III study, NPS was in a "strong financial position to move forward" with Gattex and the firm remained committed to completing development of the compound in SBS.

The company also plans to explore the drug's potential for treating other indications, such as chemotherapy-induced gastrointestinal mucositis and necrotizing enterocolitis, he added.

"The opportunity to develop and launch a first-in-class compound and to build a brand with the potential for multiple indications does not come along very often, and in fact, is a once-in-a-lifetime opportunity," he said.

The Phase III study examined Gattex, an analogue of glucagon-like peptide-2 (GLP-2), in 83 patients with parenteral nutrition-dependent SBS, a condition resulting from the surgical removal of significant portions of the bowel following injury or illness.

Patients were randomized to receive daily subcutaneous injections of 0.05 mg or 0.1 mg of Gattex per kilogram of body weight or a placebo.

The clinical efficacy endpoint of the study was a reduction of at least 20 percent in parenteral nutrition, or intravenous feeding.

"This is a response rate that clinicians as well as the FDA agreed would be clinically meaningful in this condition, for which there are no other effective therapies," Coles said. In the low-dose group, 46 percent of patients showed a 20 percent or better reduction in parenteral nutrition after 24 weeks compared with 6 percent in placebo, he explained.

"On this basis, we believe that Gattex has the potential to significantly improve the quality of life for patients with this terrible disorder," Coles said, noting that two of the participants in the low-dose group, one of whom had been receiving intravenous feeding for more than 20 years, had improved sufficiently enough to gain independence from parenteral nutrition.

"These results are impressive and speak for themselves," he said.

However, only 25 percent of patients in the high-dose group responded and showed a trend in the difference between the treatment group and placebo.

"The results from this group showed a trend that did not reach statistical significance," Coles admitted.

The study's criteria for conducting the statistical analysis of the primary endpoint required that the results for the high-dose group show statistical significance before the results of the low-dose group could be considered.

Coles contended that there are "several possible clinical and scientific explanations" as to why there was a higher response in the low-dose group vs. the high-dose group.

One theory, the company said, is that at higher doses, GLP-2 suppresses appetite and it is possible that patients on the higher dose consumed fewer calories from food and thus did not decrease their parenteral nutrition regimens.

A second hypothesis, the firm maintained, is that GLP-2 exerts various dose-dependent effects and may act by increasing nutrient absorption at low-doses while higher doses of GLP-2 may have a greater effect on mucosal and epithelial regeneration.

"Because the higher dose was not statistically significant, we will need to talk to the FDA about our findings and our analysis," Coles said, noting that Gattex has been granted orphan drug status.

"Fortunately for patients with this disease, Gattex demonstrated statistical significance at the lower dose," Coles said. "We believe the use of Gattex for SBS not only represents a first-in-class opportunity for a GLP-2 agonist, but potentially a new standard of care for this specialty indication."

If approved, Coles said, Gattex has the potential to reach $150 million to $250 million in peak annual sales.

About 92 percent of participants who completed the Phase III study have enrolled in an extension trial, Coles noted, adding that the firm received "strong support" from its data safety monitoring board to continue the extension study.

"We believe this is further evidence that we are addressing an important unmet medical need and that Gattex can be safely and effectively administered to patients with SBS."