Sunesis boosted by ASH data while cash concerns remain

Data presented by Sunesis Pharmaceuticals at the American Society of Hematology (ASH) meeting on its lead leukaemia drug voreloxin prompted a much needed 23% jump in the company’s share price this morning, to 90 cents.

Unfortunately, the Sunesis story is a familiar one among the world’s biotech minnows at the moment, of dwindling cash piles and limited options. With cash only lasting until mid 2009 at the latest, for the story to have a happy ending a source of funds needs to gallop over the horizon very quickly.

Sunesis presented data yesterday from the 55-patient Reveal-1 trial, evaluating voreloxin in previously untreated elderly patients with acute myeloid leukaemia (AML) who are unlikely to benefit from standard induction therapies; a challenging patient population.

Interim data showed an overall remission rate in 11 or 38% of the first set of 29 patients tested, exceeding the pre-specified complete remissions criteria, while five patients had levels of cancerous blood cells reduced to less than 5%. A mortality rate of 17% was similar to chemotherapy. Early results from the second group of patients was encouraging.

Positive results from another voreloxin trial were also reported at ASH, a phase Ib/II study in combination with Cytarabine in relapsed AML. The company is considering both of these indications to take forward into phase III trials, but clearly it will need a partner.

Plug the gap

Final data from a phase II trial of the drug in ovarian cancer is due around June next year. If interested parties want to see the full phase II data set across all indications before signing up, Sunesis is going to need some cash to bridge the gap. 

On the plus side, Sunesis has already started to pare back costs, but with phase II trials ongoing, this can only be achieved to a certain extent. What the company does have going for it is a platform technology called Tethering, a novel fragment-based drug discovery approach.

The platform has led to five research deals being signed, including programmes with Biogen Idec, Johnson & Johnson and Merck & Co, which have not only validated the technology, but will provide useful milestone payments should the various candidates involved progress through trials.

However, the majority of the deals cover projects that are still pre-clinical or phase I, meaning chunky payments are unlikely for a few years yet. After receiving $10m last year from its various collaborations, analysts are forecasting income of $8 and $9m this year and next.

With $18m left in the bank at the end of September, a cash injection is clearly needed, or today's share price jump is going to be short lived.