Shares of Liponex Inc. lost three-fourths of their value after the company released Phase I/II data showing that its lead cholesterol drug, CRD5, failed to significantly increase high density lipoprotein (HDL) in dyslipidemic patients.

Top-line results from the 56-patient dose-ranging trial showed it met its required safety goal, but fell short of its efficacy endpoint, defined as a mean increase in HDL levels from baseline. Patients in the study showed an overall increase of less than 5 percent for the two low doses of CRD5. Data also indicated a high variation from patient to patient, across both dose levels, with some showing a strong increase in HDL and others reporting a negative response. Further analysis is ongoing.

The news sent Liponex's stock (TSX:LPX) tumbling C$1.93 (US$1.57), or 78.5 percent, Thursday to close at C61 cents.

Despite the trial's miss, company President and CEO Bill Dickie said the drug's safety profile was encouraging and that the data signify "a formulation problem, not an efficacy problem.

"The trial indicated that the formulation didn't translate well from rats to humans," he told BioWorld Today, referring specifically the drug's bioavailability and absorption in the gastrointestinal tract.

CRD5 is designed to boost the levels of HDL - the "good" cholesterol - by "increasing the synthesis and secretion of apoliprotein A-I (ApoA-I)," Dickie said. The product does that by inhibiting cholesterol storage and stimulating cholesterol elimination through the reverse cholesterol transport pathway.

The study tested three different doses of CRD5, given as oral capsules once-daily. Of the 56 patients enrolled, 49 completed the 1-gram portion and 38 completed the 3-gram portion. Eleven patients had completed 5 grams before dosing was halted in January due to a high incidence of gastrointestinal symptoms. The primary endpoints were safety and a serum increase in HDL. Secondary endpoints included the increase in serum HDL and reduction in triglycerides and LDL.

Liponex's next step is to develop a new formulation of CRD5 for a second Phase I/II trial, expected to begin in the second half of this year, with results expected in early 2008. Dickie said that study is expected to "slightly different" and of a "simpler" design than the recently concluded trial. Pending positive data, additional Phase II studies are anticipated.

The Ottawa, Canada-based firm ended 2006 with about C$6 million in the bank, which should be adequate to fund the CRD5 reformulation process and the additional Phase I/II study, Dickie said.

"We're fortunate that we've been managing our resources carefully." He added that he doesn't expect any "drastic" cost-cutting measures. Liponex employs 18 people and averaged a cash burn of about C$300,000 per month in 2006.

CRD5 is the company's only clinical product. Though it does have a preclinical pipeline in the areas of atherosclerotic plaque, cancer and infectious disease, "virtually all of our efforts have been going into CRD5," Dickie said. "So that's not going to change."

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