Puma Biotech Founder Loses $250 Million on Disappointing Breast Cancer Drug Data

Published: May 15, 2015

Puma Biotechnology Loses $250 Million on Disappointing Phase III Breast Cancer Data
May 14, 2015
By Mark Terry and Riley McDermid, BioSpace.com Breaking News Staff

Development stage biopharma Puma Biotechnology , headquartered in Los Angeles, released details yesterday on the results of its Phase III clinical trials for breast cancer medication neratinib prior to the annual meeting later this month of the American Society of Clinical Oncology. Although not disastrous, the results were disappointing enough to investors that the company price plunged 25 percent in after-hours trading.

Puma bought the rights to develop neratinib from Pfizer Inc. in 2011. The drop in the company’s share price means company founder Alan Auerbach lost $250 million overnight, as his net worth went from about $1.19 billion to $940 million.

An early release of data by Puma indicated that patients treated with neratinib were less likely to have a cancer recurrence, but did not divulge actual details. Investors apparently let themselves believe the improvement was dramatic, while yesterday’s release indicates that the difference is actually only 2.3 percent.

“This difference may or may not be clinically meaningful in an overall risk-benefit analysis,” said an analyst at BioMedTrack. “And it is unclear whether the overall risk/benefit profile of this agent is sufficient to lead to strong uptake.”

Puma stock took a hit from the news, but has been relatively stable for most of the last year. Shares were priced on July 21, 2014 at $58.98, which took a giant jump on July 23, 2014 to $233.43. The initial public offering was announced Jan. 20, 2015. It then stayed relatively high, hitting its highest point on Sept. 18, 2014, when shares were selling for $275.07. Shares are currently selling for $173.91.

Puma’s founder, chair and chief executive, Auerbach argues that investors were misinterpreting the data, particularly as it related to comparison to Roche ’s Herceptin. In an interview with Forbes, Auerbach pointed out that in adjuvant clinical trials in HER2 positive breast cancer, patients have their HER2 status tests at their local healthcare provider or at a central laboratory. Typically, about 80 percent of those tests match up, according to Auerbach, “which means that 20 percent of the patients that the local institution believes are HER2 positive are found by the central laboratory to be HER2 negative.”

But, Auerbach points out, in the adjuvant Herceptin trials all the patients were tested by the central laboratory, which may skew the data and the enrollment qualifications.

Another point brought up is neratinib’s primary side effect, grade 3 diarrhea. Auerbach pointed out that, again, studies have found that about 50 percent of the diarrhea seen was because patients did not take loperamide as directed to control the diarrhea.

Four analysts have given Puma a Buy rating and two have given it a Hold rating. This gives the shares a consensus Overweight rating, with the consensus target price of $278.75. The company’s current value is $6.69 billion.

Puma has been on the ropes for months, after announcing in November neratinib had failed its Phase II trial for the treatment of first-line HER2-positive locally recurrent or metastatic breast cancer.

The company had been testing the drug in a NEfERTT trial, which was a randomized, two-arm Phase II trial of neratinib plus the anticancer drug paclitaxel versus trastuzumab (Herceptin) plus paclitaxel as a first-line treatment for HER2- positive locally recurrent or metastatic breast cancer.

The study had 479 patients in 33 countries with locally recurrent or metastatic breast cancer who had not received prior anticancer therapy for locally recurrent or metastatic disease. Patients were randomized to receive first-line treatment with either paclitaxel plus neratinib or paclitaxel plus trastuzumab.

But despite promising results in July, when neratinib was found effective in improving disease-free survival of breast-cancer patients, it could not duplicate those results in the mid-stage study. Puma said it will keep trying, however, and is testing the drug in eight other studies as a treatment for various forms of cancer.

Puma has attempted to stay positive about the results, stressing the drug still showed promise for other types of usage.

“As expected, there was no statistically significant difference in progression free survival and objective response rate for the paclitaxel plus neratinib arm compared to the paclitaxel plus trastuzumab arm,” said Alan Auerbach, chief executive officer and president. “However, the paclitaxel plus neratinib arm showed a statistically significant decrease in the incidence of CNS metastases compared to the paclitaxel plus trastuzumab arm.”

The primary endpoint of the NEfERTT trial was progression free survival, but results did not demonstrate a statistically significant difference between the PFS and ORR results for the two treatment arms. The progression free survival for the patients who received the combination of paclitaxel plus neratinib was 16.6 months, and 16.7 month for the patients who received the combination of paclitaxel plus trastuzumab. The objective response rate in the trial for the patients who received the combination of paclitaxel plus neratinib was 74.8 percent and the objective response rate for the patients who received the combination of paclitaxel plus trastuzumab was 75.1 percent.

Puma said those results were in line with expectations and did not mean neratinib was dead in the water quite yet.

“This represents the first randomized trial with a HER2 targeted agent that has shown a statistically significant reduction in the incidence of CNS metastases, which we believe provides a meaningful point of differentiation for neratinib in the treatment of HER2 positive breast cancer,” said Auerbach. “While the development of other HER2 targeted drugs has produced a clinically meaningful benefit to patients with HER2 positive breast cancer, these drugs have had little impact on CNS metastases. As a result, we believe that there remains an unmet clinical need for reducing the incidence of CNS metastases and the results of the NEfERTT study demonstrate that we may be able to provide this type of improvement with neratinib.” - See more at: http://www.biospace.com/News/puma-biotechnologys-cancer-drug-neratinib-fails/354676#sthash.4VmyRrvL.dpuf

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