March 4, 2016
By Mark Terry, BioSpace.com Breaking News Staff
Newtown, Pa.-based Onconova Therapeutics, Inc. announced yesterday that it had been informed by Bannockburn, Ill.-based Baxalta that Baxalta was terminating its development and licensing agreement for rigosertib.
In 2012, the two companies inked a deal to develop rigosertib for the treatment of higher-risk myelodysplastic syndromes (HR-MDS). All rights to commercialize the drug will revert to Onconova, at no cost to Onconova.
Frustratingly for Onconova and patients, the companies had just started a clinical trial in December 2015 of the drug with 225 patients. “Onconova is deeply disappointed by the timing of Baxalta’s decision,” said Ramesh Kumar, president and chief executive officer of Onconova, in a statement, “given that patient enrollment in this pivotal trial for patients with short life spans and no alternative available therapies commenced only three months ago.”
Kumar went on to say that Baxalta’s termination letter said that the clinical trial did “not align with Baxalta’s strategic priorities.”
Baxalta is required to continue to provide financial support until the Aug. 30, 2016 termination date. That support includes 50 percent of the costs of the trial up to a specific cap. Onconova is negotiating with Baxalta over financial support to complete the trial.
Baxalta is currently in the process of wrapping up its acquisition by Dublin-based Shire . After a sometimes tempestuous six-month courtship, Baxalta agreed to the acquisition for a deal totaling about $32 billion. The merged companies will focus on rare diseases, will have a presence in more than 100 countries, and is projected to have over $20 billion in annual revenues by 2020.
The company also announced that it was laying off 239 workers in California on May 1, although a spokesman for the company says the layoffs aren’t related to the merger.
Onconova has been on a fairly consistent slide since May. Shares traded on May 19, 2015 for $2.82, dropped on Aug. 11 to $1.62, spiked to $2.43 on Aug. 14, then dropped to $1.45 on Aug. 26. Shares then continued to decline and are currently trading for $0.38.
Reports published today have two analysts giving the company a “buy” rating and one a “neutral” rating.
On Feb. 4, Onconova indicated that it was transferring its listing from the NASDAQ Global Select Market to the NASDAQ Capital Market. It will continue to trade under the symbol ONTX.
Moving forward with the clinical trial was based on data from its Phase I/II trial. The company presented data regarding the results at the 57th American Society of Hematology (ASH) Annual Meeting in Orlando, Fla. on Dec. 7, 2015.
“The high response rate observed in the 09-08 combination trial is impressive,” said Lewis Silverman, a trial investigator and associate professor of Medicine, Hematology and Medical Oncology at the Icahn School of Medicine at Mount Sinai, in a statement. “Furthermore, the tolerability profile of oral rigosertib and azacitidine suggests that this combination could be used in HR-MDS. These results provide strong support for the advancement of oral rigosertib into late-stage clinical trials.”
