Reata Pharmaceuticals has shown that perseverance can pay off. Its lead project, bardoxolone, which is now focused on rare kidney diseases, is forecast to sell $1.3bn in 2024 after earlier flopping in a broader indication.
The company should soon find out whether bardoxolone is approvable, with phase III data in the project’s first indication, Alport syndrome, due in the second half of the year. And Reata and analysts alike are confident after positive results from the phase II portion of the same study.
|NPV as % market cap||65%|
|Event||Phase III data from Cardinal trial|
However, this phase II part of the Cardinal trial was much smaller and involved open-label treatment with bardoxolone, while the phase III portion contains a placebo arm, so the group should not take success for granted.
The upcoming readout will involve data from 157 patients randomised to either bardoxolone or placebo for 48 weeks, plus results from a subsequent four-week withdrawal period. The primary endpoint is estimated glomerular filtration rate (eGFR), a measure of renal function.
If the complete data are positive they should support accelerated approval. The trial will keep running for another year, comprising a second 48-week treatment and four-week withdrawal period.
Reata is hoping to replicate results from the 30-patient phase II portion of Cardinal, which found that eGFR increased by 10.4ml/min from baseline to week 48. After the four-week withdrawal period the increase in eGFR over baseline was 4.1ml/min.
Although the company did not include a placebo group, it did collect historical data showing that patients’ eGFR was declining, on average, at 4.2ml/min per year before entering the study.
The group expects to see a decline along these lines in the placebo arm of the phase III part of Cardinal, its vice-president of strategy, Vinny Jindal, told Vantage, adding: “In the withdrawal analysis we hope to see a delta between bardoxolone and placebo of greater than 2.2ml/min.”
Anything less than this could crash Reata’s share price. Leerink analysts give bardoxolone a 90% chance of success in Alport syndrome, while Stifel is almost as bullish, at 85%.
If Cardinal does read out positively Reata is prepared to go it alone with bardoxolone outside Japan and the other Asian markets where the project is licensed to Kyowa Hakko Kirin.
Reata already has the rights to commercialise the asset in the US, where it is assembling a sales force. The only question is what will happen in the rest of the world, where Abbvie has an involvement dating back to an agreement struck when bardoxolone was in development for chronic kidney disease (Reata gives Abbvie something else to think about, February 21, 2019).
Abbvie bowed out of development when bardoxolone blew up in this broader setting on a heart failure signal, but still has the right to opt in to the rare disease indications at any time in return for a fee. “If they want to opt back in to the [Europe] rights they would have to pay back essentially all of our development costs since they opted out,” Mr Jindal said.
He seemed to think this scenario unlikely given that Abbvie does not have a presence in nephrology. If the bigger group is not interested “then I imagine they’d either revert the rights back to us for some consideration, or deal them to a third party”.
Buying back Europe rights from Abbvie would be Reata’s “plan A”, he said, and the smaller group hopes that the infrastructure it is building in the US will also help its sales efforts outside the country. Still, all this will be academic if Reata does not get a win in Cardinal.