OncoMed shares tank on yet more trial woe; will refocus, review portfolio

Continuing problems have prompted Oncomed's CEO to undertake "a comprehensive portfolio prioritization review immediately."

It doesn’t rain, but it pours in April for OncoMed: Last week, it had a double dose of bad news when it revealed that its Celgene-partnered lead asset demcizumab had flunked a phase 2 pancreatic cancer trial and Bayer had walked away from two drugs, triggering a 40% drop in its stock price.

Today, its shares tumbled as much as 28% premarket as a phase 2 trial for tarextumab (its anti-Notch2/3 med), in combination with etoposide and chemo in first-line patients with small cell lung cancer, missed its primary endpoint of progression-free survival (PFS), as well as its secondary endpoints of overall survival (OS) and biomarkers showing a Notch pathway gene activation.

The "[top-line] results for the combination of tarextumab plus chemotherapy were undifferentiated from those of chemotherapy plus placebo,” the company said in a brief statement.

The median PFS for tarextumab plus chemotherapy was 5.6 months, compared with 5.5 months for chemotherapy plus placebo.

The median OS analysis, meanwhile, did not show a benefit for tarextumab in combination with chemotherapy (9.3 months) compared with the chemotherapy plus placebo arm (10.3 months). 

Additionally, five individual Notch biomarkers (Hes1, Hes6, Hey1, Hey2 and Notch3) "failed to identify a definitive subset of patients” with a treatment effect on either PFS or OS. Overall response rates were 68.5% and 70.8% in the tarextumab and placebo arms, respectively. 

On top of this, there were more setbacks: OncoMed will also now halt enrollment in the phase 1b clinical trial of brontictuzumab (an anti-Notch1) in combination with trifluridine/tipiracil (Lonsurf) in third-line colorectal cancer patients. 

The company said that a combo of brontictuzumab with chemotherapy “was not tolerable in this patient population.” Now, drastic action may be required going forward.

Paul Hastings, OncoMed’s chairman and CEO, said: “Based on the events of today and last week, we will be undertaking a comprehensive portfolio prioritization review immediately. The immediate task ahead is to thoroughly examine the available data, our resources and the opportunities to re-focus our efforts."

It ended the first quarter of 2017 with $156.9 million in cash and short-term investments.

Analysts at Leerink said in a note to clients this morning: “We’ve historically been cautious on the probability-of-success of Oncomed’s cancer stem cell targeting agents and see more promise in the company's recent efforts in building a second area of focus in immuno-oncology.

“GITR and TIGIT-targeted antibodies just entered phase 1 trials, so we think it will take some time until value-creating catalysts emerge. We're less enthused about the anti-RSPO3 agent (in phase 1) and the bispecific DLL4/VEGF inhibitor following recent setbacks of its cancer stem cell targeting agents.

“We remain MP-rated in light of the uncertainties around Oncomed’s pipeline and strategy at this point. Going forward, Oncomed management will need to focus on rebuilding the R&D pipeline in a capital-efficient manner, in our view.”