Event – GTx bulks up as cachexia trial readout nears

GTx is on a good run, with investors bidding its shares up by more than a third since January 1 on optimism for enobosarm. The Tennessee-based group is due to report data in the third quarter from a pivotal trial in lung cancer, and hopes that the pill once known as Ostarine will show that it combats muscle wasting.

Should it succeed, it would become the first project to demonstrate a positive effect on muscle strength and mass in cancer patients through modulating hormone uptake. But having proceeded unlicensed after a partnership with Merck & Co disintegrated three years ago, and with a significant proportion of its shares held in short positions, there is reason to be sceptical that GTx can confirm positive phase II results.

Company    GTx 
Product    enobosarm (Ostarine)
Market cap    $354m
Product NPV    $307m
% of market cap    87%  
Event type    Phase III trial results  
Date    Q3 2013 

Pump you up

Enobosarm belongs to a family of compounds called selective androgen receptor modulators, which aim to mimic the behaviour of sex hormones without any of the off-target effects. Muscle growth can be stimulated by steroids, for example, and indeed methylprednisolone is sometimes used, but only for two weeks because of side effects.

GTx seeks to create the same effect in a tissue-specific way. Another drug used off-label in cancer-related cachexia is megestrol, which is an appetite stimulant but has no direct muscle-building effect.

Cancer-related cachexia is thought to relate to complex biological changes brought on by the disease. It can reduce quality of life and lead to significant mortality, as well as making patients less tolerant of chemotherapies and other pharmaceutical interventions used to treat cancer (Therapeutic focus – Cachexia pipeline gaining weight, May 12, 2011).

The Power 1 trial in patients on a combination of platinum and taxane chemotherapy and Power 2 in platinum and non-taxane chemotherapy test enobosarm against placebo in patients with non-small cell lung cancer. After 84 days of treatment, investigators will determine how well the GTx project has performed in increasing lean body mass and improving physical function, as measured by stair climb power. Each trial has enrolled 300 patients.

The trial is expected to report in the third quarter; in releasing second quarter results earlier today GTx said it would not be holding a call until the data readout, suggesting that this is imminent.

Merck says no

Phase II data, based on 159 patients and published in the Lancet Oncology earlier this year, found statistically significant increases in body mass and stair-climb power for patients taking enobosarm. This was not specific to lung cancer patients, as those with colorectal, breast and haematological cancers were also enrolled.

Given that Merck probably had access to this data when it decided to hand back rights in 2010 – the phase II trial concluded in 2008 – this could raise worries about the robustness of the phase II trial. Cachexia does represent an unmet need in cancer care and as such would be an attractive commercial target, so it is surprising that big pharma would not want to be involved in a strong candidate.

To advance enobosarm through phase III and support a second clinical stage candidate, the phase II prostate cancer agent Capesaris, GTx has raised $87.5m in two separate public offerings since Merck pulled out, as well as selling US rights to breast cancer treatment Fareston to Kyowa Hakko Kirin for $21.7m last year. At June 30, its cash pile had fallen to $31.6m from $56.1m six months earlier; the group has spent $19.8m on R&D in the first six months alone, accounting for most of its cash burn.

Positive results could trigger new partnering talks, which if successful would bring in welcome new revenue. While the phase II programme for Capesaris is probably not as costly as enobosarm’s phase III, a rather short cash runway awaits GTx should enobosarm fail, and its ability to raise money from a new offering would probably be limited. GTx needs enobosarm’s phase III trials to generate powerful data.

Study Trial ID
Power 1 NCT01355484 
Power 2 NCT01355497 

To contact the writer of this story email Jonathan Gardner in London at jonathang@epvantage.com or follow @JonEPVantage on Twitter

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