This Drug Is Getting Some Negative ATTENTION

That's not exactly how ArQule (Nasdaq: ARQL  ) wanted to grab investors' attention.

Shares of the biotech dropped 18% yesterday after disclosing that its Japanese partner Kyowa Hakko Kirin had stopped enrolment in a trial, dubbed ATTENTION, a bit-of-a-stretch acronym for "Asian Trial of Tivantinib plus Erlotinib for NSCLC without EGFR Mutation trial." And shares are down a little more today.

Kyowa is testing ArQule's tivantinib in combination with Roche and Astellas' Tarceva compared to Tarceva alone in lung cancer patients. An independent safety review committee recommended halting enrollment after reports of patients that were suspected of having interstitial lung disease, a scarring of the lungs that can impair a patient's ability to breathe.

There were more cases of ILD in one of the treatment groups, and the safety committee requested additional information regarding the cases of ILD. The worry, of course, is that tivantinib is causing the ILD, but it doesn't look like that's known for sure at this point. Patients already in the trial will continue to be dosed with the drug, which I take as a good sign that this isn't an extremely serious issue.

ArQule has its own phase 3 trial with an equally opaque acronym MARQUEE (Met Inhibitor ARQ 197 plus Erlotinib vs Erlotinib plus Placebo in NSCLC), which is already fully enrolled. The decision in Japan doesn't affect that trial.

Even if it turns out tivantinib is causing ILD in patients of Asian descent, it doesn't necessarily mean that we'll see the same effect in patients in the MARQUEE trial. The different genetic makeup of Asians can result in different responses to drugs, which is the reason that Japan and other countries in Asia require separate clinical trials in patients of Asian descent.

In fact, ILD seems to be a side effect of Japanese patients taking AstraZeneca's (NYSE: AZN  ) lung cancer drug Iressa and to a lesser extent chemotherapy. There seems to be some other factors that might contribute to the susceptibility including having poor performance status, which might allow Kyowa to segment the population, using the drug on a subset of patients to increase the benefit risk ratio. Another option might be to see if a lower dose is still effective without the side effects; Asians are often started on antidepressants such as Pfizer's (NYSE: PFE  ) Zoloft, GlaxoSmithKline's (NYSE: GSK  ) Paxil, and Eli Lilly's (NYSE: LLY  ) Prozac at doses as low as half what a Caucasian patient would be prescribed.

For ArQule, the MARQUEE trial and an approval in the U.S. and Europe is much more important than gaining approval in Japan and other Asian countries. Investors won't have to wait too long. ArQule expects to have interim data from that trial by the end of the year and final data in mid-2013. Investors looking to buy ahead of the binary event, should consider the price cut as a potential buying opportunity as I don't see the news affecting the outcome of that trial.

The biggest binary event, the presidential election, is around the corner. Check out the Fool's new free report, "These Stocks Could Skyrocket After the 2012 Presidential Election," where you'll get ideas for companies that can benefit from each candidate's platform. Get your free copy by clicking here.

Fool contributor Brian Orelli holds no position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

DocumentId: 2002363, ~/Articles/ArticleHandler.aspx, 8/2/2014 3:46:57 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement