National Editor

On the heels of a major deal for its VEGF Trap, Regeneron Pharmaceuticals Inc. said it is cranking up the Phase III program testing Axokine for obesity. The move follows a meeting with the FDA to review data from the first pivotal trial, which finished earlier this year.

"I think it's approvable, as long as [data from the first Phase III trial are] confirmed in future studies and the risk profile remains as it is right now," Yaron Werber, analyst with SG Cowen in New York, told BioWorld Today.

But Axokine, he said, is no longer the value driver of Regeneron's stock (NASDAQ:REGN), which closed Wednesday at $21.53, down 22 cents.

George Yancopoulos, chief scientific officer for Tarrytown, N.Y.-based Regeneron, said going forward with Phase III is "like taking a free bet. It costs us very little to be in this game and take a bet, and the upside potential is huge."

The company intends to conduct a one-year confirmatory pivotal trial similar to the first, as well as a separate one-year study in obese Type II diabetics and several smaller studies. About 2,300 more people are expected to be enrolled in the future trials.

Axokine, a modified form of ciliary neutrophic factor, has had its ups and downs in development. Regeneron's shares plunged 56.6 percent in late March when early results from the Phase III trial indicated that neutralizing antibodies compromised efficacy, disappointing investors. The view changed somewhat in May when, at a meeting of the American Society of Hypertension, the company offered a more complete look at the data. (See BioWorld Today, April 1, 2003, and May 20, 2003.)

Full results showed that, while the drug caused only moderate weight loss in most patients, some came away with substantial reductions. Almost three times as many patients treated with Axokine plus a weight-control program lost more than 10 percent of their body weight over 12 months of treatment compared with those on a weight-control program alone - 11.3 percent vs. 4.2 percent - and the patients averaged more than 30 pounds of weight loss.

The bottom line was that Axokine met both primary endpoints: more Axokine-treated patients losing at least 5 percent of their body weight as compared with placebo; and Axokine patients achieving a greater average weight loss than those treated with placebo. The drug also met two of three primary endpoints.

Still, Werber wrote in a research note, "given that Axokine has shown modest clinical efficacy and a high rate of neutralizing antibodies, our consultants believe that Axokine will be a niche product in the obesity market."

Market uptake might be improved, he added, if benefit could be shown in combination trials with competing obesity drugs Xenical (orlistat), from Nutley, N.J.-based Hoffmann-La Roche Inc., and Meridia (sibutramine hydrochloride monohydrate), from Knoll Pharmaceutical Co., of Mt. Olive, N.J.

"It's going to take a fair amount of time," Werber said. "They're not planning on doing those studies now, so it will have to be post-marketing. We're talking years from now."

Combination trials, Yancopoulos told BioWorld Today, are "exactly what we're thinking about. In the long run, we could get around the issues with the antibodies" as well, he said, adding that the "niche product" description would fit Axokine's "minimal possibility."

Otherwise, Werber said, in order to justify Axokine's daily subcutaneous dosing, Axokine would have to show better efficacy over 12 months than Xenical and Meridia, which are administered orally.

Because the neutralizing antibodies appeared after three months, Regeneron likely will focus development henceforth on early responders, Werber said - those who lost at least 4 pounds in the first month of therapy and at least 8.8 pounds after three months. Weight loss in that group was independent of the neutralizing antibodies.

In any case, money gained from the potential $485 million VEGF Trap deal disclosed earlier this week with Strasbourg, France-based Aventis will help Regeneron advance Axokine, as will proceeds from an earlier agreement with Novartis AG, of Basel, Switzerland, focused on Interleukin-1 Trap technology. (See BioWorld Today, Sept. 9, 2003, and March 31, 2003.)

VEGF Trap is a vascular endothelial growth factor antagonist. The IL-1 Trap blocks IL-1, which regulates immune and inflammatory responses by attaching to cell-surface receptors in the immune system. It "traps" target cytokines in the bloodstream before they can attach.

Werber estimated Regeneron would submit a new drug application for Axokine in early 2006, spending about $100 million for research and development and scale-up along the way.

"The way they're looking at it is, [Axokine] has gone this far and it has a good chance of being approved," he said. "It's going to be able to pay for itself."