Zafgen surprises again, but bigger questions remain

It is a fair bet that Zafgen investors are used to extreme share price volatility by now, and today they got another surprise. The company’s obesity project beloranib not only scored in its curtailed pivotal trial, but it managed to hit both co-primary endpoints more convincingly than could realistically have been expected.

So far so good. But the path ahead of beloranib is anything but straightforward; it is still anyone’s guess whether Zafgen can come up with a convincing risk-mitigation plan to allow a US clinical hold to be lifted, even considering the outstanding efficacy shown today.

Investors seemed untroubled by the caveats, with Zafgen trading up nearly 80% in the premarket today before opening up 50%. The shares had crashed last October amid rumours of a patient death in the beloranib pivotal trial, only to climb when the death was confirmed; the second hammer blow came in December when another patient died and the FDA put beloranib on complete clinical hold.

The two patient deaths are the reason why safety with the project is paramount, almost irrespective of just how good the efficacy data are. And there is no clue when the hold might be lifted; as a guide, US hold on Geron’s imetelstat, over less serious, non-fatal adverse events, took eight months to be rescinded.

It seems inconceivable that Zafgen could get away without another phase III trial, not to mention some kind of safety study. For now investors have to be content with excellent efficacy data from the pivotal ZAF-311 study in 107 patients with Prader-Willi syndrome (PWS), a genetic disorder in which patients have chronic hunger that can lead to life-threatening obesity.

Study halt

ZAF-311 had actually been halted before the clinical hold, since investigating the first patient death could have interfered with blinding, and Zafgen decided that there was enough follow-up to yield sufficient study powering (Zafgen’s fate hangs on outcome of two part-completed studies, October 23, 2015).

However, there had been doubts whether these curtailed trial data would be sufficiently convincing. These doubts were swept away today when Zafgen said both the 1.8mg and 2.4mg beloranib doses caused strong weight loss at six months versus placebo, as well as affecting patients’ hyperphagia questionnaire scores – a measure of food-seeking behaviour – with high statistical significance.

On a call today Zafgen executives reported PWS caregivers’ view that the efficacy was unprecedented, but the much bigger question is what the group will now take to the FDA. Details were sketchy, with Zafgen saying it was still working on  strategy; a risk-mitigation plan will look at patient screening and identifying biomarkers.

Both deaths – one in the active study and the other in the open-label extension – were due to pulmonary emboli, and were classified as “possibly related to study drug”. Zafgen said it was “developing a comprehensive approach to understand ... mechanisms underlying thromboembolic disease in the setting of PWS.”

One move must surely be to lower the beloranib dose, as supported by the finding that the difference between 1.8mg and 2.4mg efficacy was slight. However, the fact that one death occurred on each dose level will temper enthusiasm.

At the end of the third quarter Zafgen had $204m in cash, so at least it has no pressing need to go to investors for more. And with such a healthy bank account the group can hardly be expected to throw in the towel, especially as PWS is in itself a serious life-threatening condition.

However, overcoming beloranib’s adverse event profile looks to be a herculean task.

To contact the writer of this story email Jacob Plieth in London at [email protected] or follow @JacobPlieth on Twitter