June 12, 2015
By Mark Terry and Riley McDermid, BioSpace.com Breaking News Staff
Cambridge, Mass.-based AVEO Oncology stock is once again gyrating after the U.S. Food and Drug Administration (FDA) gave the company even more disappointing feedback regarding its trial data of perpetual problem drug tivozanib.
The news is just the latest setback to a company which has seen its share price plummet and struggle to regain traction after a series of regulatory stoplights.
Tivozanib is an oral selective inhibitor of vascular endothelial growth factor (VEGH) and was being investigated in a 265-patient randomized trial to treat advanced metastatic colorectal cancer. The trial, dubbed BATON-CRC, studied the combination of FOLFOX6 and tivozanib or bevacizumab.
Results of the trial were presented to the FDA along with updated analyses and proposed a pivotal Phase II trial. The FDA responded by indicating Aveo should do more work to develop its biomarker assay to examine variability between other assays, stating that at present, “insufficient data exists to determine the appropriateness of this [NRP-1 low] subgroup” for a Phase III study.
A study Aveo is conducting in kidney cancer with tivozanib, however, has met its efficacy endpoints.
Aveo stock dropped about 7.01 percent on the news. On June 4 shares sold for $2.49. They are currently selling for $2.04. Stocks sold on Jan. 16, 2015 for $1.76 and for the most part of have been on an upward climb.
Analysts have been mixed. Equity analysts at RBC Capital upgraded the company’s rating, which now have a “perform” rating, up from an “underperform” rating.
There is also evidence of executives in the company buying and selling shares. The Wall Street Observer has them listed under a headline “Biotech Stocks You Should Dump” which also includes ZIOPHARM Oncology, Inc., Oncothyreon Inc. and Esperion Therapeutics, Inc. .
Other analysts have noted that Aveo was the target of short interest growth in May. About 4.2 percent of company shares were sold short. Zacks downgraded stock from a “buy” to a “hold.”
Aveo has indicated it plans to continue its study of tivozanib and FOLFOX in NRP-1 low colorectal cancer by a prospectively defined, randomized Phase II trial, while simultaneously working on a commercial assay.
“NRP-1 expression is a biomarker of growing interest for malignancies treated with angiogenesis inhibitors,” said Michael Bailey, president and chief executive officer of AVEO in a statement.
“As part of our effort to develop a commercial companion diagnostic, we continue to evaluate alternative NRP-1 assays,” he said. “Feedback from the FDA reinforces the importance of these ongoing efforts prior to embarking on a pivotal trial. We look forward to continuing our dialogue with the Agency and cooperative groups toward the design and potential conduct of an appropriate confirmatory study and the development of a companion diagnostic.”
Late last week the company announced it had received written support from European regulatory organizations for the filing of a Marketing Authorization Application (MMA) for tivozanib. The company received support from the Rapporteur and co-Rapporteur, from Portugal and the U.K., respectively, both members of the Committee for Medical Products for Human Use (CHMP). Should Aveo submit the MAA, those two members would head the evaluation.
At that point the stock took a jump from $1.97 on June 1 to $2.55 per share on June 2.
The company has three other pipeline products, including ficlatuzumab, AV-203 and AV-380. Ficlatuzumab is being studied for the treatment of NSCLC in combination with BDX001, a serum protein test commercially available by Biodesix, Inc. AV-203 is a clinical-stage ErbB3 inhibitory antibody candidate being tested in tumors of the breast, head and neck, lung, and ovarian and pancreatic cancers. AV-380 is being studied for the treatment of multiple cancer cachexia models.
The company has also been shedding staff and slashing costs in an effort to stay afloat. Last month Aveo said it had relocated its offices in Cambridge as part of a cost containing plan during the company’s restructuring plans announced in January, which saw a shift in executive officers as well as the termination of approximately two-thirds of its workforce.
In addition to the smaller space in Cambridge, AVEO also unveiled a new corporate logo.
The new site in Cambridge is considerably smaller than the company’s previous facility, a 90 percent reduction in facilities from the company’s prior Cambridge location at 650 E. Kendall Square. The site, at One Broadway, includes 5,000 square feet of office space under flexible lease terms, with no laboratory or vivarium space.
“AVEO is now a streamlined organization with its resources squarely focused on the execution of a strategy aimed at leveraging biomarker insights and exploring partnership opportunities to advance our pipeline. We look forward to making progress toward our goals in the near future, and to outlining a path forward for the new AVEO,” Bailey, AVEO’s president and chief executive officer, said in a statement.
The company chopped two-thirds of its workforce earlier this winter. Prior to January’s restructuring, Bailey served as the company’s chief business officer, but in January he took over the company’s top spot. He replaced Tuan Ha-Ngoc, who became chairman of the board of directors. Henri Termeer, who previously served as chairman, became lead outside director. Additionally the company slashed about 40 employees, which included elimination of the AVEO’s internal research function.
There have been some bright spots for the company, however few and far between. In mid-November 2014, Aveo entered into a research and option agreement with Ophthotech Corporation that will give Opthotech exclusive rights outside of Asia to investigate tivozanib, which has the potential to treat non-oncologic diseases of the eye.
Under the terms of the deal, Ophthotech paid AVEO an upfront option fee of $500,000, and if it elects to continue development of the ocular formulation of tivozanib during the option term, it will pay AVEO up to $8 million in milestone payments.
If Opthotech decides to obtain additional development and commercialization rights to tivozanib and products containing tivozanib for non-oncologic eye indications in territories outside Asia, AVEO would receive an option exercise fee of $2 million and could also receive clinical and regulatory-based milestone payments of up to $50 million, as well as sales-based milestone payments of up to $45 million and royalties.
A percentage of all upfront, milestone and royalty payments received by AVEO are due to Kyowa Hakko Kirin as a sublicensing fee.
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