Years after being hailed by biotechnology analysts as a potentialblockbuster drug, Liposome Technology Inc.'s (LTI) DOX-SLanticancer product is ready to go before the FDA.The Menlo Park, Calif., company said Wednesday it filed a new drugapplication (NDA) for its long-circulating Stealth formulation of theanticancer compound doxorubicin hydrochloride, to treat Kaposi'ssarcoma (KS) in AIDS patients who cannot tolerate or have failedconventional systemic chemotherapy.But LTI's submission, rather than boosting the company's positionwith investors, resulted in a 13 percent drop in the stock(NASDAQ:LTIZ), which fell $1 per share Wednesday to $6.75."I know of absolutely nothing that would account for this," PeterLeigh, LTI vice president and chief financial officer, said of thepuzzling stock drop. "You'd think that after waiting this long for anannouncement of this kind, the market would respond favorably. Itseems quite counter-intuitive, but that's the way life is."Matthew Geller, an analyst with Oppenheimer & Co. of New York,told BioWorld, that he didn't fully understand the stock drop, either."The announcement seems very positive," he said. "People hadenormous expectations for this technology several years ago and theygradually became frustrated. I think it's time to get more enthusiasticabout it."While other analysts didn't understand the investor reaction, theyspeculated to BioWorld that there may have been concern over the wayclinical responses were measured, what pharmacologic effect the drugmay have because of it being in the system longer, or how long it willtake the FDA to review the submission.LTI's Stealth technology allows liposomes, coated with polyethyleneglycol, to elude the body's immune system, and has a half-life of 48hours in the bloodstream, while circulating up to a week, Leigh said.Conventional, uncoated liposomes are cleared from the plasma in a fewhours, and the unencapsulated "free" drug is cleared in minutes, LTIsaid.By remaining in the bloodstream for long periods, the liposomes passthrough defects in the vasculature into tumor sites. "We know we candeliver five to 11 times more drug than free drugs," Leigh said."This filing for KS is part of a larger strategy to develop a drug to beused in a wide variety of chemotherapeutic settings," Leigh said. "Thereal potential of DOX-SL, in our view, rests in its potential to be asecond-generation version of doxorubicin, the world's most widelyprescribed chemotherapy agent."Toward that end, LTI has DOX-SL in a number of other clinical trials.It is in comparative Phase III trials in the U.S. and Europe against thestandard three-drug regimen for KS, which is meant to demonstrate theefficacy of DOX-SL as a primary therapy. The drug also is being testedin separate Phase II trials in ovarian, breast, primary liver and non-small cell lung cancers, as well as soft tissue sarcomas.Leigh said LTI expects to file for European approval of DOX-SL as afirst-line therapy for KS by the end of the year, and to use the ongoingcomparative trials as a basis for a supplemental filing for that indicationin the U.S.KS, Leigh said, is found almost exclusively in homosexual men and isassociated with late stages of AIDS. It appears as reddish or purplelesions on the skin, which are often the only visible sign of full-blownAIDS, and can occur at almost any site. Half of the estimated 20,000KS patients in the U.S. develop lesions in the mouth, LTI said.Results of a multi-center Phase II/III trial of DOX-SL for KS included247 patients, 133 of whom had six cycles of therapy and couldtherefore be considered fully evaluable. Of the 133, three achievedcomplete response, 81 had partial response, 38 had stable response and11 had progression of the disease, Leigh said."If you look at the totality of responses, there's clearly a clinicalbenefit, which varies from patient to patient," Leigh said. "Swelling ispart of it, colorization is part of it, pain is part of it." n

-- Jim Shrine

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