West Coast Editor

The faithful followers of Telik Inc.'s Telcyta got their waited-for reward in Phase II data from a combination trial with the drug against non-small-cell lung cancer, and shares increased enough to take a little of the sting out of December's failures.

Telik's stock (NASDAQ:TELK) closed Tuesday at $6.43, up 54 cents, or 9.2 percent.

In several Phase III studies against lung and ovarian cancers, Telcyta late last year yielded failures (in two monotherapy trials) or skewed results (in a combination with carboplatin), and shares of Telik took a hit of more than 70 percent, ending at $4.77 on the day of the news. (See BioWorld Today, Dec. 27, 2006.)

Many investors harrumphed when defenders of the chemotherapy pointed to blockbusters for cancer that stumbled in late testing but ultimately won approval, such as South San Francisco-based Genentech Inc.'s Avastin, Herceptin and Tarceva. But now Telcyta (canfosfamide) is boasting strong data from the Phase II combo trial with carboplatin and paclitaxel in first-line, advanced NSCLC.

Data disclosed at the American Association for Cancer Research's annual meeting in Los Angeles show statistically significant improvements in progression-free survival and overall survival in patients who got Telcyta maintenance therapy as compared with those who didn't.

Telcyta is the first in a new class of cancer cell-activated chemo drugs designed to exploit the overexpression of glutathione S-transferase P1-1, found in many cancer cells. High levels are associated with a poor prognosis and resistance to some chemo treatments.

Telik's Phase II study enrolled 129 patients with Stage IIIb or Stage IV NSCLC, given standard doses of carboplatin and paclitaxel and one of four doses of Telcyta (400, 500, 750 or 1,000 mg/m2) for a planned course of four to six cycles. Patients with objective responses or stable disease after they finished combo therapy could choose to take maintenance cycles of Telcyta by itself every three weeks until disease progression. Evaluated outcomes were safety, objective response and disease stabilization rates, progression-free survival and overall survival in the intent-to-treat population, and safety, progression-free survival and overall survival in patients given maintenance therapy.

In the intent-to-treat population (129 patients), the overall objective response rate was 34 percent, including one complete response. Fifty-six patients, or 43 percent, had disease stabilization, for an overall disease stabilization rate of 77 percent. Median progression-free survival totaled 4.9 months, with an overall median survival of 9.6 months.

One hundred patients, or 77 percent of those enrolled, had objective responses or stable disease at the completion of combo therapy. Half of those got Telcyta maintenance therapy, and the median progression-free survival for them was 6.9 months, compared with 4.2 months for the others (p< 0.0001, HR 0.36). Overall median survival for Telcyta patients was 14.2 months compared with 8.4 months without Telcyta maintenance (p= 0.0003, HR 0.40).

Telik said the triplet combo was generally well tolerated at all Telcyta doses, with toxicities similar to those expected with each drug alone. Maintenance therapy was well tolerated, too, with Grade 1 or Grade 2 toxicities observed in less than 5 percent of patients.

Analysts such as Joel Sendek with Lazard Capital Markets in New York have been skeptical of Telcyta since the December data. Sendek wrote that the results gave him "little confidence in the drug's activity." More sanguine was Mark Monane, with Needham & Co., who also published a report in February. "We believe that Telcyta is an active compound, given the objective responses" in all three Phase III trials.

Still ongoing is Telik's ASSIST-5 trial with Telcyta, comparing the drug and doxorubicin to treatment with doxorubicin alone against platinum refractory or resistant ovarian cancer, which Sendek and Monane said might face alterations after one of the studies from December, called ASSIST-3, is further analyzed.

Brian Rye, analyst with Janney Montgomery Scott LLC in Philadelphia, wrote in a report Tuesday that the latest news on Telcyta "provides a glimmer of hope where none previously existed," and raised his rating to "neutral" from "sell," while keeping "long-term concerns" regarding the drug's chances of reaching the market.

Telik ended December with cash and marketable securities totaling $142 million (and no debt), which Rye estimated will support operations into 2009, with a cash infusion needed before a new drug application could be filed.

Rye noted "no guarantee that [ASSIST-5] trial results won't be compromised in the same way as the ASSIST-3 results were apparently affected." Telik officials could not be reached.