Betting on Arqule’s Phase II Results
Despite this spate of stunning Phase III failures, investors and Wall Street continue to reward companies that produce promising Phase II results in lung cancer. On March 31, Arqule’s stock skyrocketed on news that its lead drug, ARQ 197, in combination with Tarceva improved the median progression-free survival (PFS) of patients with advanced NSCLC by 66%. The company opened the day at $7.09, a 102.57% jump from the previous closing price of $3.50.
Arqule and Daiichi Sankyo have a license, co-development, and co-commercialization agreement for ARQ 197, a small molecule kinase inhibitor that targets the c-MET tyrosine kinase receptor.
The difference in PFS between the two arms of Arqule’s Phase II study did not achieve statistical significance when a a log-rank test was applied. When adjusting for imbalances in the distribution of key prognostic factors, however, the difference in PFS was found to be statistically significant by applying a Cox regression analysis specified for secondary efficacy analyses.
Improvement in median PFS was more pronounced in the predefined subgroup of patients with nonsquamous histology; median PFS was 18.9 weeks in the treatment arm versus 9.7 weeks in the control arm, a 94% improvement. There were no clinically relevant differences in adverse event rates between the treatment and control arms. The majority of adverse events were mild in intensity and included rash, diarrhea, and fatigue.
“We believe the treatment benefit observed in this trial would represent a meaningful clinical improvement over standard therapy if replicated in Phase III trials,” stated Brian Schwartz, M.D., Arqule’s CMO. “We are especially encouraged by the potential benefit for the large subgroup of nonsquamous cell patients. We will thoroughly analyze our extensive database from this trial, including additional patient subgroup characteristics, to optimize ongoing and future trials of ARQ 197.”
That’s a lot of belief in Phase II study results that still must meet efficacy criteria in Phase III trials. But to analyst Andy Smith’s point that Phase III studies generally include more diverse and often sicker patients than Phase II studies, Arqule’s belief may be justified. Its Phase III trials will likely focus on patient subgroup identification to treat those mostly likely to respond to ARQ-197, thereby having a better shot at hitting an efficacy endpoint.
Meanwhile, despite the disappointment over its Phase III trial discontinuation, Antisoma will keep at it with a pipeline of diverse compounds. Antisoma CEO, Glyn Edwards, said that the focus of investment would be on Phase III leukemia treatment AS1413 and Phase II leukemia drug AS1411.
“It [drug development] is a risky business, and that’s why we try as best we can to build a portfolio of opportunities,” said Edwards. “While we will be a smaller company going forward, there is still value in our other programs.” And as long as pipeline-hungry pharma companies continue to troll for promising drug candidates, Antisoma and other firms will no doubt keep getting funding for compounds with strong Phase II results.