Shares of Dendreon Corp. (DNDN) have lost nearly 50% of their value since the company's initial public offering in June 2000. Blame it on Provenge, the company's much touted investigational therapeutic vaccine for prostate cancer that flunked the FDA muster, disappointing many patients and fraying the nerves of investors.
But Dendreon has not given up on Provenge, which according to the company is on the brink of commercialization. Dendreon has pinned its hopes on the ongoing IMPACT (Immunotherapy for Prostate AdenoCarcinoma Treatment) study designed to measure overall survival in men with late stage prostate cancer receiving Provenge compared to placebo. While interim results from the IMPACT study are expected to be available during the second half of this year, final results are anticipated to be presented during the second half of 2009.
The making of Provenge
Provenge, an investigational therapeutic cancer vaccine belongs to a new class of therapy known as Active Cellular Immunotherapy. It works by stimulating the immune system to recognize a protein known as the prostatic acid phosphatase or PAP, which is found in about 95% of all prostate cancer cells and mounts an attack on the cancer cells.
There are two types of vaccines namely therapeutic and prophylactic. While a therapeutic cancer vaccine is given to patients to treat existing cancers, a prophylactic cancer vaccine is given to healthy subjects to prevent infection with cancer-causing viruses. Merck & Co. Inc's (MRK) Gardasil and GlaxoSmithKline's (GSK) Cervarix, which are approved to prevent cervical cancer, are examples of prophylactic cancer vaccine.
Though Dendreon, which filed the Biologics License Application in 2006 seeking approval for Provenge was optimistic about the vaccine's approval, some analysts cautioned that Provenge was unlikely to get the green light from the FDA. Skepticism was such that when Dendreon announced on March 1, 2007 that Provenge has been taken up for review by the FDA panel, the company's stock shed 8.84% to close at $4.23.
Contrary to doomsday predictions of some analysts, on March 30, Provenge was voted 17 to 0 safe and 13 to 4 efficacious by an FDA panel of experts, giving Dendreon's stock price an unexpected lift. The share price, which nearly tripled in the first few minutes of trading on March 30, 2007 to $14.90 a share, closed the day's trade at $12.93. Buoyed by the FDA panel's positive vote, Dendreon's stock price continued its upward march and hit a 52-week high of $25.25 on April 10, 2007. But the joy was short lived for Dendreon. On May 9, 2007 the FDA issued an approvable letter, requesting Dendreon to furnish more clinical data related to Provenge. Reacting to the news, the stock took a whacking, losing over 64% to settle at $6.33 at the close of the trade.
However, not all was lost for Dendreon as the FDA agreed to accept either positive interim or final analysis data of survival from the company's ongoing Phase 3 D9902B IMPACT study to support Provenge's approval, which the company is banking on now. In October of 2007, Dendreon completed enrollment of over 500 patients in the IMPACT study.
Despite a number of biotech firms investigating cancer vaccines for decades, not a single therapeutic cancer vaccine has been approved by the U.S. FDA. Last month, U.S. biotech Antigenics Inc's (AGEN) cancer vaccine Oncophage was approved in Russia for kidney cancer. However, the vaccine is yet to win the U.S. FDA approval because the data from the Phase III trial completed in 2006, did not show sufficient efficacy.
An insight into Provenge Trials
In 2000, Dendreon initiated a double-blind, placebo-controlled Phase 3 trial, evaluating Provenge in men with prostate cancer. It was around the same time - on June 16, 2000 that Dendreon took the final leap from a backwater biotech startup to a public corporation, making an initial offering of shares to the public at $10 each. Despite the hype surrounding Provenge, an immune-based prostate cancer therapy, Dendreon's IPO was not as hot as expected. The shares dropped 3% to close the first day of trading at $9.69.
The phase 3 study, dubbed D9901, enrolled 127 men with late stage, metastatic, hormone resistant prostate cancer - 82 of who were administered three infusions of Provenge and 45 were given placebo over a four-week period. The study was designed to measure time to disease progression and time to development of disease-related pain in men with hormone resistant prostate cancer.
Hormone resistant prostate cancer commonly referred to as Androgen independent prostate cancer or AIPC is an advanced stage of prostate cancer in which the tumor growth is no longer regulated by androgens, or male hormones. Currently, there are no FDA-approved therapeutic treatment options for men with AIPC.
The results of an interim analysis of the D9901 study released in January 2002 were disappointing, as Provenge failed to meet its primary endpoint of slowing disease progression. The negative results from the trial took a toll on the company's share price, setting off a 38% fall. The stock fell to $5, down $3.05 on the Nasdaq on January 11, 2002, the day the study results were reported.
Although the interim results of the D9901 trial did not achieve statistical significance, further analysis of the data in August 2002, revealed that Provenge delayed the progression of disease and the onset of disease-related pain in men with advanced prostate cancer, whose cancer has a Gleason score of 7 and less. (Gleason score is a measure of the severity of prostate cancer).
Dendreon's second Phase 3 trial, D9902, was still underway when the interim results of D9901 study were released and the survival follow up was still ongoing. In order to confirm the D9901 study results, after consulting with the FDA, in December 2002, the company halted further enrollment in its D9902 study, which had till then signed up 98 patients with advanced prostate cancer. The original target was 120 patients.
The study of the truncated group in which 98 patients were enrolled, regardless of Gleason score was named D9902A. In June 2003, Dendreon initiated another study, dubbed D9902B trial, enrolling only those patients with Gleason scores of 7 or less.
On October 28, 2004, the company released the final data of the completed D9901 study of Provenge, including the three-year follow up results. According to the final D9901 study results, Provenge extended the lives of men with advanced prostate cancer by an average 4.5 months, though not significant, regardless of their Gleason score. The news pushed Dendreon's shares up $1.90, or 24%, to $9.85. The final survival data showed a statistically significant survival benefit in the group of patients with Gleason scores of 7 and less.
In January 2005, Dendreon reported the preliminary D9902A trial data, which supported the results of D9901 trial. However, D9902A study, which enrolled 98 men with advanced prostate cancer, fizzled as it did not show a statistically significant delay in time to disease progression in the overall group or in the Gleason score of 7 and less, which was set as the primary endpoint. Following the ambiguous results, the stock lost nearly 40% in the month of January alone that year.
But the crux of the matter is that the final three-year survival data from D9902A study reported in July 2005 also showed that Provenge extended the survival of men with advanced prostate cancer by 3.3 months, which again did not meet the criteria for statistical significance Though the experimental results were exciting, it was hardly an earthshaking evidence because D9902A study was not a complete one as it was only a small, truncated trial which had enrolled only 98 patients.
Meanwhile the trial D9902B, which received a positive Special Protocol Assessment from the FDA was amended in November 2005 and came to be known as the IMPACT study. The primary end point of the ongoing IMPACT study is overall survival, and time to disease progression, which was the primary end point in the earlier trials D9901 and D9902A is now the secondary endpoint. As mentioned earlier, the interim results from the IMPACT study are expected to be available during the second half of this year and final results are anticipated to be presented during the second half of 2009.
FDA at fault?
The FDA's ruling on Provenge delaying the vaccine's approval is criticized by many patient advocacy groups. In July of 2007, Care To Live, a non-profit group filed a suit in federal court in Ohio against FDA commissioner Andy von Eschenbach; Richard Pazdur, chief of the FDA's oncology drug division; and Howard Scher, an oncologist and FDA advisory panel member. However, the Judge dismissed the suit last November saying that the FDA has still not pronounced its final decision on Provenge and that the vaccine's Biologic License Application administrative process is ongoing.
A number of lawsuits have been filed against the FDA for its decision on Provenge. In all the suits, the allegations center on the conflicts of interest of Howard Scher and Maha Hussain two of the four members of the FDA advisory panel who voted against recommending Provenge for approval. Scher who participated in the advisory panel, which reviewed Provenge, was also the lead investigator for Novacea Inc. (NOVC), a company which was testing prostate cancer drug Asentar, a product competing with Provenge. The suit also charges that Scher is an officer in Proquest Investments, which owned over 8% stake in Novacea at the time of Provenge review. Therefore Proquest Investments stood to benefit by the FDA's unfavorable decision on Provenge.
Whether the charges against the dissident panel members are proven or not, the future of Provenge is not tied to the outcome of the lawsuits, but rests solely with the results of the ongoing IMPACT study.
But some experts believe that the FDA was right in delaying the approval of Provenge, as the clinical data submitted by Dendreon was too small to determine the risk/benefit profile of Provenge. Not an erroneous logic though!
After all, the regulatory agency, which has been strongly criticized over the safety of approved drugs, having to withdraw some drugs from the market for safety reasons, cannot be faulted for being extremely cautious.
Provenge - A new hope?
Though there are a number of potentially curative treatment options for early stage prostate cancer, the main alternatives available to men with metastasized prostate cancer known as Androgen Independent Prostate Cancer or AIPC include radiation, and Taxotere, a chemotherapy drug made by Sanofi-Aventis in combination with a steroid drug prednisone. But these treatments generally are considered to have severe side effects.
Taxotere injection in combination with prednisone, which prolongs the life span of men with advanced prostate cancer by 2.5 months, is associated with toxicities such as edema, liver damage, and neutropenia and carries a black box warning.
Initially, the prostate cancer will be an androgen dependent tumor, meaning the growth of the tumor will be promoted by male sex hormones, also known as androgens. The male sex hormones such as testosterones are strong tumor promoters. Therefore in early stages, androgen deprivation therapy, which reduces the levels of male sex hormones, will cause prostate cancers to shrink or grow more slowly.
When the prostate cancer becomes metastasized or has spread to the bone or other organs, the tumor growth will no longer be dependent on the male sex hormones or androgen. This stage of prostate cancer is known as Androgen Independent Prostate Cancer or AIPC, which is an advanced form of prostate cancer.
Since there are no treatment options currently for Androgen Independent Prostate Cancer, Provenge promises a hope for men who are battling advanced stage prostate cancer, without having to suffer the side effects of traditional chemotherapy.
According to some analysts, Provenge has US sales potential of $1 billion. Prostate cancer is the second leading cause of cancer death in American men, next to lung cancer. The American Cancer Society estimates that during 2008 about 186,320 new cases of prostate cancer will be diagnosed in the United States. More than 2 million men in the United States have been diagnosed with prostate cancer.
As prostate cancer sufferers in the U.S. eagerly await the approval of Provenge, the other side of the Atlantic solidified the commercial potential of Provenge early this year. On January 15, Dendreon was granted a broad European patent covering Provenge and other active cellular immunotherapies. According to the Cancer Research UK, approximately 670,000 men are diagnosed with prostate cancer in the U.K. each year.
Financial metrics
Ever since its inception, Dendreon's loss has widened year-over-year due to increasing operating expenses. For the year ended December 31, 2007 the company's loss widened to $99.2 million from $91.6 million a year before. However on a per share basis, due to a higher number of outstanding shares, the company's loss for the year narrowed to $1.20 from $1.27 in 2006. Operating expenses during 2007 increased to $102.6 million from $97.6 million a year earlier. During 2007, Dendreon spent $76.52 million for Research & Development, up from $74.09 million in 2006. As the company does not have any commercial product, all of the revenue generated is collaborative research revenue and license revenue. The company's revenue for 2007 was $743 thousand, compared to $273 thousand in 2006.
In the pipeline
Other than Provenge, Dendreon's yet another cancer vaccine, which is at the forefront, is Lapuleucel-T also known as Neuvenge, for breast cancer. According to results published in the August 20 issue of the Journal of Clinical Oncology, in a phase I clinical trial of Neuvenge, four of 18 breast cancer patients who were administered the Neuvenge vaccine had their tumors shrunk or stabilized.
Trp-p8-related compound, known as D3263 is another investigational drug on which Dendreon is "spending fair amount of resources right now." According to Dendreon, D3263 could have therapeutic benefits in lung, breast, prostate and colon cancers. On May 22, the company presented pre-clinical data showing that its Trp-p8-related compound, D-3263, could be beneficial in patients with BPH (benign enlargement of the prostate). The company plans to file an investigational new drug application later this year to initiate a study examining D-3263 in advanced cancer, including prostate cancer.
According to research reports, there is enormous market for BPH or benign prostatic hyperplasia as more than 50% of men in their 60s and as many as 90% in their 70s and 80s have some symptoms of BPH. The National Institutes of Health estimates that there are currently more than 28 million men suffering from BPH in the United States. Common symptoms of BPH include urinating problems and in severe cases, urinary tract infections, bladder or kidney damage, bladder stones, and incontinence.
Some of the current treatment options available for BPH are Boehringer Ingelheim's Flomax, Pfizer Inc.'s (PFE) Cardura, Abbott Labs (ABT) Hytrin, Merck & Co. Inc. (MRK) Proscar and GlaxoSmithKline's (GSK) Avodart.
Dendreon's investigational drugs, which are in pre clinical stages include Carcinoembryonic Antigen or CEA, to treat lung, colon and breast cancers, Carbonic Anhydrase 9 Antigen or CA-9, to treat cervical, colon and kidney cancers and Anti-Serine Protease Monoclonal Antibodies to treat various cancers.
Conclusion
If approved, Dendreon's Provenge could be the first new drug for advanced prostate cancer in more than 20 years. But investors will have to wait till the company releases the interim results of the phase 3 study in the second half of 2008, and final results in the second half of 2009, which will either put Provenge on the market or seal its fate. Until then, it's going to be a long, long waiting game for Dendreon, as pointed out by A.G. Edwards analyst, Aaron Reames.
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