Despite what Athersys Inc.'s president and chief operating officer B. J. Lehmann called a "high level of optimism" about its stem cell product, Multistem, the company's shares (NASDAQ:ATHX) were sliced in half Monday after it reported that the off-the-shelf cell therapy failed to moderate the severity of disease in patients with treatment-refractory ulcerative colitis (UC).
In the fully enrolled phase II study of 128 patients with chronic, advanced UC, a single intravenous administration of Multistem did not show statistically significant improvement compared to placebo in either of two primary efficacy endpoints: change in endoscopic (modified Baron) score from baseline at eight weeks and change in Mayo rectal bleeding subscore from baseline at four and eight weeks.
At four weeks, the proportion of responders on Multistem was greater than placebo, but the benefit was offset by declines in other Multistem-treated patients so that overall benefit at all measured time points was not significant, according to Athersys. Additional secondary endpoints at weeks four and eight were explored, but no significant differences were observed between the placebo and treated groups, including clinical response and remission.
Although Multistem demonstrated favorable safety and tolerability, investors seemed more worried about the therapeutic effect across other potential indications. Athersys shares sank to a 52-week low of $1.09 before closing at $1.33 for a drop of 51.3 percent on the day. The volume of 12.6 million shares was more than 10 times higher than average.
The interim findings were based on patient follow-up eight weeks following a single administration of Multistem in a study conducted by partner Pfizer Inc.
Lehmann said he expects Pfizer to report additional data from 16 weeks of patient follow-up in the randomized trial, which enrolled patients across approximately 50 sites in North America and Europe. Among the findings still to come are the clinical impact of a second round of dosing in a subset of patients, longer term secondary endpoints in symptom severity and an evaluation in changes from baseline in the biomarker fecal calprotectin.
Those data – especially the biomarker analysis – may inform the companies about the path forward in UC, "but at the end of the day, it's not going to change the results of the study," Lehmann admitted. "These results would make it difficult for Pfizer to push this forward."
New York-based Pfizer, which had its hands full with its $99 billion bid for Astrazeneca plc, did not comment on the study findings. (See related story.)
"Pfizer wants to complete the work on study," Lehmann said. "Enrollment is complete, and certain data are collected. There's a lot of additional analysis to be done."
Pfizer partnered with Athersys in a 2009 deal valued at a potential $111 million, though the company received just $6 million up front. The pharma giant also selected the inflammatory bowel disease (IBD) indication. (See BioWorld Today, Dec. 22, 2009.)
The phase II study was conducted in two parts. Eighteen patients were enrolled in a dose selection phase, followed by an efficacy phase that enrolled 88 patients, powered for the primary endpoints. Eligible patients had moderate-to-severe active UC with a Mayo score of six to 12 points and endoscopic score of at least two (as measured by modified Baron score) despite prior treatment with corticosteroids, immunosuppressants or anti-TNF agents. The mean disease duration for patients enrolled in the efficacy stage of the study was 10 years.
Patients enrolled in the efficacy stage received either Multistem or placebo initially, followed by a second round of Multistem or placebo at eight weeks.
ACUTE DISEASE REPRESENTS 'LOWER-HANGING FRUIT'
Despite the obvious, the data may provide a bit of upside clarity for Cleveland-based Athersys. First off, the findings could indicate that Multistem – an adult-derived stem cell product that does not require tissue matching – simply is not suited for chronic, advanced disease. That could be something of a relief to the company, considering two other advanced programs are in acute conditions: acute myocardial infarction (AMI) and ischemic stroke. Athersys is running a double-blind, placebo-controlled phase II stroke study that plans to recruit approximately 140 patients, with enrollment expected to be completed by the end of the third quarter.
The primary efficacy endpoint for that study is an assessment at 90 days of the proportion of patients who achieve independent living, measured by modified Rankin Scale. Those data are expected to report by year-end.
"That's a completely different patient population and a very different mechanism than what was at work here in ulcerative colitis," Lehmann told BioWorld Today. "You don't have the baggage of a conditioned immune system that you have with the ulcerative colitis patients, and you don't have the baggage of someone who's got essentially a chronic condition, with all that implies."
The second bright spot for the company is that "a lot of our other programs are more like stroke than they are like UC," he added. In addition to AMI, for which the company plans to launch a phase II by year-end, the company has orphan drug designation for its Multistem treatment in graft-vs.-host disease (GVHD), which has completed a phase I study. The GVHD program will be ready to advance into phase II/III study by year-end but will require a partner, "so we'll wait and see how things play out," Lehmann said.
"The take-home here is that, in a condition like UC – an advanced autoimmune condition – a single administration, at least in Multistem, just wasn't sufficient for effect," he added. "You probably have to take a different treatment approach or administration approach, and Pfizer didn't do that experiment here."
Lehmann is hopeful that the company's approach to seek the "lower-hanging fruit" of acute disease will prove more productive than the chronic outcomes of the Pfizer-partnered program. Long term, "partnership is part of the story" for Athersys, he said, and that means achieving success in the company's upcoming trials.
"We've got to go do the work, but we're moving ahead," he said. "This is disappointing – believe me – but on the other hand we've got some other good opportunities that are pretty exciting where we think we have better odds of success."
That was essentially the conclusion reached by Piper Jaffray analyst Edward Tenthoff. In a company note, he removed value for Multistem in UC from the company's stock, reducing the target price to $4 from $4.50.
He retained an "Overweight" rating for Athersys, however, calling the ischemic stroke indication a "potential game changer" for the company.
"While stroke is a difficult indication, a positive read-out could represent a true blockbuster," Tenthoff wrote.
In addition, legislative changes in Japan now permit conditional approval of regenerative medicine products after safety has been demonstrated in early stage trials, setting the stage for Athersys to sign a Japanese partnership for Multistem this year, Tenthoff said.