Washington Editor

Genentech Inc. and partner XOMA Ltd. stopped Phase II testing of Raptiva in patients with moderate to severe rheumatoid arthritis after an evaluation suggested there was no efficacy.

The evaluation was handled by an independent Data Safety Monitoring Board charged with reviewing data in the 240-patient exploratory trial, a statement released by South San Francisco-based Genentech said.

Even though the partners have agreed to discontinue this particular Phase II, Tara Cooper, a spokeswoman for Genentech, stopped short of saying rheumatoid arthritis (RA) would be dropped as an indication. "It's too soon to comment on whether [the companies] will consider another trial," she told BioWorld Today.

In late December, the companies submitted a biologics license application for Raptiva (efalizumab) as a treatment for moderate to severe psoriasis. (See BioWorld Today, Dec. 27, 2002.)

Michael King, managing director with Banc of America Securities in New York, didn't seem to think disappointing news in RA would have a notable impact on Genentech. "I had no estimates in my model for Raptiva in RA," he told BioWorld Today.

Indeed, Felicia Reed, an analyst who covers XOMA for Adams, Harkness & Hill in Boston, told BioWorld Today she didn't have RA in her model, either. "It is disappointing, though, because if it had worked, there could have been an upside to our estimates," she said.

There is one thing that concerns Reed.

"It could be extrapolated negatively that if Raptiva doesn't work in RA, then the implication is that it doesn't work on joints. XOMA and Genentech are doing a study in psoriatic arthritis and the Phase II data will come out in the first half of 2004," Reed said. "So you could extrapolate the negative RA study to mean that the psoriatic arthritis study may not work, and if that is the case, it could put Raptiva at a bit of a disadvantage to Enbrel, which is approved for psoriatic arthritis and will probably be approved for psoriasis."

Enbrel (etanercept) is an anti-tumor necrosis factor drug for RA and psoriatic arthritis made by Thousand Oaks, Calif.-based Amgen Inc.

King and Reed agreed that Raptiva (formerly called Xanelim) likely will win FDA approval later this year in moderate to severe psoriasis. (Cooper said Genentech expects action by October.)

In psoriasis, Reed estimates U.S. sales to reach $560 million annually by 2007. "The overall message here is that people should buy XOMA's stock based on the weakness and we think the stock can go to $7 on Raptiva in moderate to severe psoriasis."

XOMA's stock (NASDAQ:XOMA) closed Monday at $4.72, down 77 cents, or 14 percent, while Genentech's stock (NYSE:DNA) closed at $37.87, up 82 cents.

Meanwhile, in January XOMA started a Phase II trial to evaluate Raptiva in patients with active and progressive psoriatic arthritis. The trial is a multicenter, randomized, double-blind, placebo-controlled study designed to evaluate the reduction in signs and symptoms of the disease at 12 weeks. Cooper said the companies haven't released an estimated date of completion.

Raptiva, a humanized monoclonal antibody, inhibits the adhesion of T lymphocytes to other cell types by inhibiting the binding of LFA-1 to ICAM-1. This mechanism of action has a number of effects depending upon the cell type, which include inhibition of T-lymphocyte activation, proliferation and cytokine release; inhibition of T-lymphocyte migration; and inhibition of T-lymphocyte interactions with tissue-specific cells, the companies said.

The companies had planned to file the BLA in moderate to severe psoriasis in late 2001 but were delayed when the FDA requested a pharmacokinetic study to confirm the equivalence between materials used for testing and manufacturing. That was a result of modifications made in the transition from small-scale to large-scale production. (See BioWorld Today, Oct. 8, 2001, and April 8, 2002.)

Meanwhile for Genentech, it is a partner in the development of Xolair for allergic asthma, which is going before an FDA advisory panel Thursday. Partners are Novartis Pharma AG, of Basel, Switzerland, and Tanox Inc., of Houston.