Data showing a positive performance by Cephalon Inc.'s Myotrophinin Phase III trials for combating the deadly Lou Gehrig's disease sentthe West Chester, Pa.-based company's stock soaring 75 percentMonday and pulled most other biotechnology stocks up with it.
"This is the kind of event that will restore the investor equivalent ofconsumer confidence in the biotech industry," said David Stone, ofCowen & Co. in Boston. "It's the first reminder of the rewards inquite some time."
Cephalon released data showing its recombinant human insulin-likegrowth factor (IGF-1) achieved statistical significance at the higherof two doses in slowing progression of amyotrophic lateral sclerosis(ALS) and in lessening severity of the disease. The drug also wasconsidered safe.
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ALS is a degenerative neuromuscular disease that destroys motorneurons, leading to loss of muscle control and death from respiratoryfailure three to five years after onset of the disorder. An estimated70,000 people worldwide have ALS and half are in the U.S.
Mark Simon, of Robertson, Stephens & Co. in San Francisco, saidMyotrophin performed better than expected. He suggested the datashould help Cephalon "achieve a top tier status in biotechnology."
Cephalon is developing Myotrophin in a 50-50 collaboration withChiron Corp., of Emeryville, Calif. Cephalon's stock(NASDAQ:CEPH) was not traded until noon Monday and ended theday at $18.38, up $7.88 with about 6 million shares changing hands.Chiron (NASDAQ:CHIR) closed at $61.75, an increase of $6.88, or12.5 percent, with 4 million shares traded.
Mostly on the strength of Cephalon's trial results, the AmericanStock Exchange (AMEX) biotechnology index jumped 10.16 points,from 81.21 to 91.37 Monday.
David Crossen, of UBS Securities in New York, described the boostin the AMEX index as the largest single day increase in recentmemory.
The Chicago Board Options Exchange biotechnology index alsoended the day up 4.55 points to close at 111.63.
While Myotrophin is not a cure, Cephalon's president and CEO,Frank Baldino, said the drug is the first to alter the course of ALS.
Last month, Rhone-Poulenc Rorer, of Collegeville, Pa., releasedPhase III data revealing that its small molecule drug, Rilutek,demonstrated statistical significance in extending ALS patients lives_ the primary endpoint. The drug apparently showed patientssurvived up to three months longer. However, Rilutek was noteffective in slowing muscle function deterioration.
Although survival rate was not an endpoint in the nine-monthMyotrophin studies, Cephalon said treatments were continued and at15 months 71 percent of the patients on the drug were still alivecompared with 55 percent survival among the placebo group.
In Rhone-Poulenc's trials, after one year, 73.7 percent of the patientsreceiving Rilutek were still alive compared with 62.8 percent of thoseon placebo.
Baldino estimated the Myotrophin data indicates the drug may extendthe lives of ALS patients four months or more. However, some WallStreet analysts described that interpretation as unscientificextrapolation.
Toni Claudio, an analyst with Smith Barney Shearson in New York,said Myotrophin showed it can make ALS patients feel better, but thedata did not reveal the drug prolonged their lives. Rilutek, she added,showed it extended patients' lives, but they didn't feel any better.
Lynn Klein, vice president of patient services for the AmyotrophicLateral Sclerosis Association in California, said ALS patients, whocurrently have no effective treatments, welcome both Myotrophin andRilutek.
"It's exciting," she said. "A year ago we had nothing. Now we havetwo potential therapies."
Klein said ALS strikes each of its victims differently and shesuggested if both drugs are approved by the FDA, they will be usedin combination.
"You have to keep a perspective on this," she said. "ALS was firstidentified in 1869 and we still don't know what causes it."
Baldino said Cephalon and Chiron may be able to apply for FDAapproval by the end of this year or early in 1996.
Bob Pearson, spokesman for Rhone-Poulenc Rorer, said his companyexpects to file for approval of Rilutek worldwide in July. n
-- Charles Craig
(c) 1997 American Health Consultants. All rights reserved.