Why Threshold Pharmaceuticals Tumbled

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What: Shares of oncology-focused biotech company Threshold Pharmaceuticals (Nasdaq: THLD  ) dove as much as 33% earlier in the trading session following the release of additional mid-stage data on the company's proprietary drug TH-302. It's being tested in combination with Eli Lilly's (NYSE: LLY  ) Gemzar to treat pancreatic cancer.

So what: In February we were given statistically significant evidence that TH-302 -- a drug that works by targeting the hypoxic cells often found in solid tumors but rarely found in normal tissue -- in combination with Gemzar successfully extended survival rates to 5.5 months from 3.5 months with Gemzar treatment alone. Today's results added to that initial study demonstrating a 2.3 month survival improvement at the median, to 9.2 months from 6.9 months.

On the flip side, adding TH-302 with Gemzar as opposed to using Gemzar alone only reduced the relative risk of death by a not-so-significant 4.5%. Threshold also alluded that about one-third of its 214-patient mid-stage trial may have skewed the results in favor of TH-302. That one-third was switched from Gemzar alone to the combination therapy as soon as tumor progression was noticed.

Now what: Threshold is bound to be a fickle and highly volatile company with just one drug in its pipeline, TH-302. However, TH-302 is being tested in 11 different clinical trials at the moment, including in combination with Pfizer's (NYSE: PFE  ) blockbuster Sutent to treat renal cell carcinoma and gastrointestinal stromal tumors, so the chances for success in at least some of these trials appears promising based on its initial survival rate increases.

But Threshold won't have an easy go of things even if it gains FDA approval of TH-302 in combination with Gemzar. Both Peregrine Pharmaceuticials' (Nasdaq: PPHM  ) bavituximab, which is begin targeted at treating pancreatic cancer as well as a secondary treatment for non-small cell lung cancer, and Celgene's (Nasdaq: CELG  ) Abraxane which, when combined with Gemzar, demonstrated stabilization in disease progression in 13 of 16 patients in an early stage study, stand to make pancreatic cancer a crowded field. I remain optimistic about Threshold's bountiful pipeline, but I'd keep your expectations reasonable.

Craving more input? Start by adding Threshold Pharmaceuticals to your free and personalized Watchlist so you can keep up on the latest news with the company.

Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

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  • Report this Comment On September 17, 2012, at 4:25 PM, Hope4GoodFuture wrote:

    Thanks Sean. You mention: "Threshold also alluded that about one-third of its 214-patient mid-stage trial may have skewed the results in favor of TH-302." I was thinking that the crossover from Gemzar to TH-302 actually skewed the results against TH-302. I thought they were saying that the control group may have lived longer than a control would have had there not been a cross over. Am I thinking about this incorrectly?

  • Report this Comment On September 17, 2012, at 9:10 PM, TruffelPig wrote:

    There is nothing wrong with the article but one statement in the last paragraph is just amazing......the author here states pancreatic cancer treatment could get crowded. Dear author, currently this cancer is one of the most deadly cancers out there and a horrible disease. The standard treatment Gemcitabine + Tarceva is stopping being efficient (if at all) fast. Cancer gets resistent to the treatment fast. Thus, combination treatments buy time and patients go from one combination to the next until it stops working.

    For example, maybe Gemcitabine + TH-302 is first line followed by Gemcitabine - Bavi second line etc etc. This actually give patients time as the disease can not be cured without operation - likely also not after these drugs might be approved. The 5 year survival rate is way below 5%.

    Also, better designed future studies might give some insight in cancer genetics (patient profiling) and administering certain drugs for certain genotypes of the adenocarzinoma of the pancreas (this like most cancers can have many genetic differences that manifest in similar phenotypes). Also triplets might be used combining Gemcitabine with Terceva and Bavi or TH302. It is ALL GOOD because currently there is nearly NO HOPE in the treatment of this terrible disease.

    I gained some insight in how "fantastic" our treatment options are after my father was diagnosed. Gemcitabile and Terceva worked a bit for 6 month, the 5-FU after that were torture and completely inefficient.

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