AstraZeneca will have a tricky decision to make in the next eight weeks on whether to persevere with Ardelyx’s gastrointestinal project tenapanor.
The NHE3 inhibitor has shown clear promise in irritable bowel syndrome (IBS), but has stumbled in treating chronic kidney conditions in two separate trials now, with a phase II failure in diabetes-related kidney disease announced yesterday. Ardelyx executives recognise that the mixed data could drive Astra to hand the programme back by a June 29 deadline and say they are prepared to proceed into phase III. Finishing this job might be a bigger task, however.
Shares in California-based Ardelyx today dropped 26% to $8.08, their lowest since the group's 2014 float. This followed yesterday’s post-market news that compared with placebo tenapanor failed to significantly reduce the albumin-creatinine level in diabetes patients with chronic kidney disease.
It was the second stumble for the agent this year: three months ago a trial targeting hyperphosphataemia in dialysis patients turned up unexpected diarrhoea rates, prompting a 29% sell-off.
The setbacks leave constipation-predominant IBS as the only indication in which tenapanor has yet to show negative signals; a phase II trial showed that the agent, which reduces intestinal absorption of dietary sodium and phosphorus, can improve the complete spontaneous bowel movement responder rate compared with placebo. That study showed a “modest” incidence of diarrhoea.
It is fortunate for Ardelyx that IBS is where tenapanor looks best. This is the biggest of the three indications in which it is being tested, with new agents such as Linzess and plecenatide growing the market to $2.8bn by 2020, although some of this total is for the diarrhoea-predominant form of the disease.
The licensing agreement with Astra gives the UK partner until June 29 to decide how to proceed. A decision to move ahead in IBS would trigger a $10m milestone, and in any other indication $20m would be paid to Ardelyx, chief executive Michael Raab said in an analyst call.
The go-it-alone scenario
Should Astra hand back rights – something Mr Raab acknowledged as a possibility in an unusually forthcoming way – Ardelyx is sufficiently funded to initiate its own phase III trials in IBS and hyperphospataemia.
“We would welcome the opportunity to continue our collaboration with [Astra], but we would also welcome the opportunity to get the programme back. Either way we are ready,” Mr Raab said.
Ardelyx had $107.3m in cash at December 31. It seems doubtful that it could complete a pivotal programme with such a war chest – Linzess’s pivotal programme enrolled over 7,000 patients and took more than three years – so a fund raising would almost certainly be needed to accompany the start of an independent phase III.
Thus, a decision by Astra to withdraw from the collaboration, should it come, could knock Ardelyx’s shares even more. But even if the UK-based partner remains on board, a return to the $30-plus share prices seen during last year’s post-IPO run-up seems unlikely until more persuasive data emerge.