Investors unloaded shares in Corgentech Inc., which on Monday reported a Phase III failure.
The sell-off dropped the South San Francisco-based company's stock (NASDAQ:CGTK) by 59.2 percent, or $11.29, to close at $7.71.
Two hours before the markets opened, Corgentech and its pharmaceutical partner, Bristol-Myers Squibb Co., said top-line evaluations of primary and secondary endpoints revealed that E2F Decoy (edifoligide) failed to show a benefit compared to placebo when considering the rate of vein graft failure in peripheral artery bypass patients through 12 months following surgery. John McLaughlin, Corgentech's president and CEO, summed up his reaction to the findings in one word: "disappointed."
"I don't think anyone ever expects that," he told BioWorld Today. The companies continue to analyze the results, McLaughlin added, declining to discuss specific findings at this time. They plan to report more complete efficacy data from the trial, called PREVENT III, in future scientific publications and presentations by the study's clinical investigators.
E2F Decoy is applied to a vein by a surgeon just prior to implanting as a bypass. The vein is treated outside of the body by bathing it in the drug in a procedure that is incorporated into the operation.
The drug is designed to prevent the implanted vein from accumulating smooth muscle cells that collect cholesterol, and instead forces the graft to thicken in a different way that causes it to resemble the architecture of an artery.
"We were specifically looking at whether treatment reduced or delayed the occurrence of graft failure or amputation," McLaughlin said. "Any procedure to fix a failed or failing graft within 12 months following bypass surgery counted toward the composite endpoint of graft revascularization and amputation."
Technical failures were excluded from the primary endpoint, but were counted as part of one secondary endpoint that also missed its mark. In terms of safety, the product generally was well tolerated during a 30-day observation period in the 1,400-patient trial, which was conducted at 80 sites.
Previously, a Phase I/II trial in peripheral bypass graft patients showed that treatment with E2F Decoy resulted in significant inhibition of the E2F-controlled genes and the smooth muscle proliferation that leads to bypass graft failure.
The product has received the FDA's fast-track status in the peripheral graft indication, as well as for coronary grafting.
It remains in a separate Phase III study, called PREVENT IV, in 2,400 coronary artery bypass graft (CABG) patients at more than 100 sites. The primary endpoint there is the percent reduction in the incidence of critical graft stenosis (blockage of the graft of 75 percent or greater) between the treated and placebo groups. McLaughlin pointed to the difference in endpoints being measured in PREVENT III and IV.
"With respect to CABG," he said, "we have studied the drug in more CABG patients than peripheral patients, before the Phase IIIs."
A Phase II trial in CABG patients produced a statistically significant reduction of blockage of 75 percent or greater in E2F Decoy-treated patients
Corgentech and BMS expect to report PREVENT IV results by the end of the first quarter. After that, the companies plan to meet with the FDA to discuss approval strategies. The companies already have submitted the preclinical section of a rolling new drug application, but will delay clinical and manufacturing sections until getting agency guidance. They also have to apply for approval of a chamber that helps deliver the drug.
"It is a drug for purposes of regulatory actions," McLaughlin said, "but fast track does authorize, at the best, discretion of the agency to [act] on the basis of one trial."
Just more than a year ago, the partners entered a deal potentially worth $250 million to Corgentech. Terms of the alliance call for it to share development costs in the U.S. and Europe with New York-based BMS, based on a pre-agreed percentage allocation. In the U.S., they would co-promote E2F Decoy and share profits. Rights in all other countries are controlled by BMS, which will pay Corgentech a royalty on sales. (See BioWorld Today, Aug. 15, 2002.)
The companies recently have begun a Phase I/II study of the drug in arterial venous grafts, as well.
Outside of E2F Decoy, Corgentech is developing another decoy product to target the NF-kB transcription factor. It is designed to treat inflammatory disorders, and the company expects to advance it early next year into the clinic for eczema. The same drug also has been in preclinical testing for inflammatory bowel disease.
Preclinical studies of a third decoy product, being developed to target the HIF transcription factor, have generated proof-of-concept data. Corgentech has yet to set a timetable for bringing it into the clinic, McLaughlin said.