September 8, 2016
By Alex Keown, BioSpace.com Breaking News Staff
BOSTON – Shares of Tokai Pharmaceuticals soared nearly 18 percent in pre-market trading after the company announced it had initiated a review of strategic alternatives that could include a sale of part or all of the company, a reverse merger or disposition of corporate assets.
While the company explores those options, Tokai said it will assess the best path forward for its galeterone clinical trial program, all while saying patients currently participating in the ARMOR3-SV clinical trial will discontinue treatment by the end of the year. In August, the company announced it had terminated enrollment in a Phase II expansion trial of galeterone. In July, the company announced the Phase III trial of prostate cancer drug galeterone was not likely to meet its endpoints. The ARMOR3-SV was established to demonstrate that galeterone could do a better job than Medivation’s Xtandi (enzalutamide) in preventing the spread of prostate cancer whose tumors express AR-V7. However, the data monitoring committee overseeing the trial said it did not appear galeterone would meet its goals and recommended termination of the trial. Galeterone was the only drug Tokai had in the clinic, according to its website.
Following the failure of the ARMOR3-SV trial, Tokai slashed its workforce by 60 percent, leaving the company with about 10 employees to move forward. The move was done to reduce operating expenses while the company conducted an evaluation of options for the future of the experimental drug and the company’s pipeline.
As the company looks to its options for the future, investors appear to be backing the move by snapping up shares of company stock. In pre-market trading, shares of Tokai have jumped from its closing price of $1.03 per share to $1.21 per share.
Galeterone, which was Tokai’s lead drug, is an oral small molecule that was something of a combination of two popular prostate drugs on the market—Janssen’s Zytiga (abiraterone) and Xtandi (enzalutamide). Additionally Tokai said the drug introduces a third mechanism—androgen receptor degradation—that “impairs the function of androgen receptors, decreasing their sensitivity to androgen activity and reducing tumor growth.” It was through this triple threat pill that Tokai hoped to make a big splash in the prostate cancer market, but fell short, which brings up questions as to the future health of the company. Galeterone showed promise in its early trials in meaningful reductions of levels of prostate specific antigen, or PSA, a biochemical marker used to evaluate prostate cancer patients for signs of response to therapy, according to the company website.
In addition to galeterone, Tokai licensed a drug discovery platform from the University of Maryland in Baltimore called ARDA, androgen receptor degradation agents. The company said that platform enables researchers to “identify and develop novel compounds designed to have potent androgen receptor degradation activity.” Tokai said its most advanced compound from that platform is currently in preclinical development. It is unknown if that program been suspended while the company undergoes its review of strategic alternatives.
