By Randall Osborne

West Coast Editor

Hobbled by lack of favorable results from trials in patients with osteoarthritis of the knee, Chiron Corp. has halted its program to develop insulin-like growth factor-1 (rhIGF-1).

The company's stock (NASDAQ:CHIR) suffered, closing Tuesday at $42.437, down $7.234.

Shelley Schneiderman, spokeswoman for Emeryville, Calif.-based Chiron, called the trials "a learning experience. The market reacts, not always justifiably. We've been here since the crack of dawn, speaking with analysts."

Chiron examined data from two Phase IIa proof-of-concept trials, both lasting 13 weeks. In the first, subjects undergoing arthroscopy were injected with rhIGF-1 or placebo directly into the cartilage. They showed no statistically significant differences when histology of biopsies before and after treatment were compared.

In the second trial, treating knee-replacement patients with the protein - which had shown promise for promoting growth in earlier studies - or placebo before surgery, comparison between the histology of the replaced knee's cartilage and baseline were not compelling enough to justify more experiments in that area.

Schneiderman emphasized the trials were exploratory, with a drug intended to modify cartilage structure.

"There's been no other product known to do that," she said.

"This is not the same as when you stumble in a Phase III," Schneiderman added. "There were pre-specified endpoints and we didn't hit those, but we have some data that merits further exploration." The company will not be more specific about that data yet, she said.

Chiron, which last year fell just below analysts' earnings estimates, took a hit earlier this year when its recombinant fibroblast growth factor-2 failed to meet its primary endpoint, improvement of exercise at 90 days, in a clinical trial involving symptomatic coronary artery disease patients, although the drug seemed to work against chest pain. (See BioWorld Today, March 14, 2000, p. 1; and Feb. 10, 2000, p. 1.)

That program is still alive, Schneiderman said. "The preliminary data were mixed," she said. "We missed the primary endpoint, but had promising secondary endpoints."

Phase II trials are under way in coronary artery disease and peripheral artery disease, with results expected in the first half of 2001, she said.

Chiron has a sepsis drug, recombinant tissue pathway factor inhibitor, in Phase III trials.

"[Sepsis] is an incredibly difficult field, but we're moving ahead and accruing patients," Schneiderman said.

Another Phase III trial is testing Chiron's oncology product, Proleukin (IL-2), in HIV. "We're trying to reach the halfway accrual point this year," she told BioWorld Today. Proleukin is approved for renal cell carcinoma and metastatic melanoma.

Prospective approval deadlines for the sepsis drug and for Proleukin against HIV are "out past 2005," Schneiderman added.

Last year, Chiron's sales of Betaseron (interferon beta-1b) to Berlex Laboratories Inc., of Wayne, N.J., for marketing and resale increased $3 million to $66 million for the year, beating 1998's figure of $63 million. Talks are ongoing with the FDA about a secondary-progressive multiple sclerosis indication for the drug, Schneiderman said.

"Berlex will be submitting it, and it's quite near-term," she said.

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