Small cap biotechnology company MEI Pharma (NASDAQ:MEIP) in conjunction with Swiss pharmaceutical company Helsinn Group announced the discontinuation a collaborative Phase 3 study of blood cancer drug candidate pracinostat.
The San Diego-based company is focused on the development of hematology-oncology pharmaceuticals. Its portfolio includes four clinical stage product candidates.
The disappointing news followed MEI Pharma’s interim futility analysis of pracinostat in combination with chemotherapy drug azacytidine as a treatment for patients with acute myeloid leukemia (AML). It concluded that the oral investigational drug was unlikely to meet the study’s primary endpoint of overall survival as compared to the control group.
AML is a blood and bone marrow disorder caused by the spread of abnormal hematopoietic myeloid cells. It more commonly occurs in older patients who often do not respond as well to intensive chemotherapy treatment.
Drug Candidate Had Received FDA’s Breakthrough Therapy Designation
As a result of the analysis, the companies made the decision to cease patient recruitment and terminate the study. The 500 patients enrolled in the study received 60mg doses of pracinostat in combination with azacytidine and were compared to a control group who received only azacytidine. MEI Pharma noted that the decision was based on the drug candidate’s lack of efficacy rather than safety concerns.
In combination with azacytidine, pracinostat has received the Orphan Drug Designation from both the U.S. Food and Drug Administration (FDA) and the European Medicines Agency (EMA). It has also been granted the Breakthrough Therapy Designation by the FDA.
The abandonment of the late-stage trial was a major disappointment for MEI Pharma investors who had anticipated much of the company’s near-term growth potential to be derived from the drug. Aside from the Phase 3 study for the treatment of AML patients, pracinostat it is also being evaluated in a Phase 2 study in patients with high-risk myelodysplastic syndromes (MDS). Pending further evaluation, the patients enrolled in this study will continue with the treatment.
MEIP Pharma is scheduled to report second quarter earnings on August 26th. After posting small net losses per share over the last several quarters the company is expected to swing to a profit according to the consensus EPS forecast of $0.27.
Leading up to the July 2nd announcement, the stock had buy ratings from all five analysts covering the stock with price targets ranging from $9.00 to $16.00. MEI Pharma shares closed down 18% to $3.49.