Following is an extract from a report issued prior to the lung results. -------------------- Progen Pharmaceuticals are due to report data from a phase-II study of PI-88 in combination with docetaxel (marketed by Sanofi Aventis as Taxotere). The company flagged reporting of the trial data by end September in an August update to the market.
Before discussing our view on the upcoming data, we remind investors that our standing valuation of PGL focuses exclusively on the liver cancer project. Our interpretation of Progen’s commercialisation strategy for PI-88 is that the company will aggressively pursue registration of the drug as an adjunct therapy to surgery for liver cancer.
Post resection liver cancer is an unmet medical need that provides a significant commercial opportunity for PGL that the company should be able to access in a timely manner (relative to other opportunities for PI-88). Our view is based on an understanding that management has focused the bulk of the company’s resources on commencing and executing a phase-III trial of PI-88 in post resection liver cancer.
Phase-II trials for other oncology indications were initiated in the past. Progen had initiated a series of phase-II studies in other oncology indications when the commercial strategy revolved around securing a global licensing deal. Three non-liver phase-II trials were initiated to target:- second line non-small cell lung carcinoma (NSCLC), hormone refractory prostate cancer, and advanced melanoma. Each of the three trials is geared to assess the benefit of PI-88 given in combination with a chemotherapeutic agent (docetaxel – NSCLC and prostate cancer; DTIC – advanced melanoma). Given the imminent disclosure of data from the NSCLC trial (and our focus on liver cancer notwithstanding) we thought it worthwhile to present our view on what to expect from the lung data.
The underlying patient pool is extremely ill. The NSCLC trial is being conducted in patients with advanced disease (stage-IIIB/IV) in a second line therapy setting. The prognosis of patients at second line is significantly worse than for patients receiving standard first line therapy. Historically, approximately 80% of patients receiving second line docetaxel experience disease progression by 6-months – an important statistic as progression free survival (PFS) at 6 months is the primary end point of the phase-II trial. Median survival for docetaxel patients at second line is roughly 7.5 months (although this varies slightly from study to study).
A good outcome carries upside for PGL whereas lack of activity is neutral. Given that PGL are not resourced to carry out a phase-III study of PI-88 outside of liver cancer, we would view a positive outcome from the trial as further enhancing the potential of Progen to secure a favorable deal for PI-88 with a leading global pharma. If, on the other hand, the data fail to demonstrate a clinical benefit we see no downside for PGL.
Firstly, we point out that that the phase-II trial is an assessment of a specific therapeutic regime (PI-88 and docetaxel) rather than a trial of PI-88 per se. To highlight the relevance of this, we contrast the clinical benefit of erlotinib (an EGFR inhibitor marketed by Genentech and Roche as Tarceva) in NSCLC given as monotherapy to the lack of benefit observed when the same drug was added to platinum-based chemotherapy in NSCLC patients.
Secondly, failure of PI-88 to benefit second line docetaxel therapy of NSCLC patients would not impact on the validity of the phase-II liver cancer data presented in April 2007.
Our basis for this view is that the liver cancer study was conducted in the context of surgical clearance of the tumour – a setting in which the anti-heparanase activity of PI-88 has greater scope to generate a clinical benefit from inhibition of metastatic spread compared to an advanced disease setting where distant metastasis have already formed. ------------------------------ eG got on to reaffirm their current valuation of $16.45 and confirm that this valuation is based only on liver.
PA
PGL Price at posting:
0.0¢ Sentiment: Buy Disclosure: Not Held
