When drugmakers play hot potato after a drug fails, the original rights holder usually ends up holding the spud.

Aeterna Zentaris (Nasdaq: AEZS) is hoping to make a baked potato.

The biotech said yesterday that it had regained North American rights to perifosine, its cancer drug that was being developed by Keryx Biopharmaceuticals (Nasdaq: KERX) until it failed to show an effect in colorectal cancer.

The drug is still in a phase 3 trial for multiple myeloma testing in combination with Velcade sold by Takeda and Johnson & Johnson (NYSE: JNJ) and a generic called dexamethasone compared with Velcade and dexamethasone alone. Aeterna Zentaris said it plans to continue that trial and Keryx will get low single-digit royalties if the drug is eventually approved in North America.

It's a little hard to know whether continuing the trial is worth the money. Certainly there are plenty of drugs that have worked with one cancer type but not another -- Pfizer's (NYSE: PFE) Sutent is a prime example -- but there are also plenty of drugs that haven't worked on any cancer. Without knowing the cost of continuing the trial or the likelihood of success, which is probably quite low given Keryx's decision, it's not clear whether Aeterna Zentaris is just throwing good money after bad or making a reasonable high-risk, high-reward bet.

It's also not certain how long it will take to run the trial. Keryx said the recruitment for the multiple myeloma trial has been "difficult," and that's not likely to get any easier after doctors heard about the failure in colorectal cancer. There are a couple of interim peeks at the data scheduled, and reading between the lines, it looks like Aeterna Zentaris might be planning to drop the drug at that point if it doesn't seem like perifosine works in multiple myeloma.

Only time will tell whether continuing the trial is a good move for Aeterna Zentaris. While you wait, I certainly wouldn't give the biotech any value for reacquiring perifosine.

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