Last week, Corbus Pharmaceuticals (NASDAQ:CRBP) reported positive top-line data from a phase 2 study evaluating anabasum in treating cystic fibrosis (CF). At least, the company said the data was positive. Some observers disagreed, saying that the results actually weren't so great.

Investors appeared to side more with the naysayers. Corbus stock dropped 11% and has kept on falling. What's the controversy about? And what's next for Corbus? 

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Two words that sank the stock

Anabasum met the primary objective of the study by demonstrating an acceptable safety and tolerability profile at all doses with no serious or severe adverse events. Corbus CEO Yuval Cohen stated that the company was "delighted" with the results.

However, investors weren't delighted the least bit with two words in the study results: "remained stable." Corbus said that the change in the forced expiratory volume in one second (FEV1) percent remained stable for patients taking anabasum throughout the study. The problem is that cystic fibrosis drugs ideally should improve FEV1 percentages rather than cause them to stay essentially the same. 

But isn't the main focus of phase 2 studies supposed to be safety? Sure. But investors expect solid efficacy results alongside a positive safety profile. For example, when Vertex Pharmaceuticals (NASDAQ:VRTX) reported phase 2 results for Kalydeco in 2015, the drug demonstrated good safety and tolerability while also significantly improving FEV1.

Some might say that patients in Corbus' study were only treated for 12 weeks. What's more, patients only took the highest dosage (20 mg/day) of anabasum for eight weeks. That's not long enough to show much improvement, right? Again, let's look at Vertex's results. That phase 2 study of Kalydeco went on for 12 weeks -- the same duration as Corbus' study.

Last month, Vertex announced results from a couple of late-stage studies of tezecaftor in combination with Kalydeco. One study evaluated CF patients through 24 weeks of treatment. However, the other looked at change in FEV1 from baseline to the average of the week four and week eight measurements. That's eight weeks -- the same amount of time patients in the Corbus phase 2 study took the highest dosage of anabasum. By the way, the tezecaftor/Kalydeco combo significantly improved FEV1 in both studies. 

But what about the huge reduction in pulmonary exacerbations?

Corbus' headline for the phase 2 results stated that "anabasum reduces acute pulmonary exacerbations." Yuval Cohen mentioned this reduction in his remarks. So did the principle investigator of the study, James Chmiel. The results said that "the highest dose of anabasum (20 mg twice per day) was associated with a 75% reduction in the annualized rate of pulmonary exacerbations requiring treatment with IV antibiotics, compared to placebo." 

Does that count as a big plus for anabasum's efficacy? It would, except when you dig into just how many patients that 75% reduction represents. Three patients in the placebo group experienced acute pulmonary exacerbations requiring treatment with IV antibiotics. One patient taking a twice-daily 20 mg dose of anabasum had an acute pulmonary exacerbation requiring treatment with IV antibiotics. 

That's an awfully low sample size from which to draw any meaningful conclusion. The reduction is even more suspect when we consider that the number of patients who experienced pulmonary exacerbations was the same in the group that took the 20 mg dose of anabasum once per day (rather than twice per day) as the placebo group. 

Maybe anabasum does do a bang-up job at reducing the likelihood of pulmonary exacerbations. If so, that would be great, especially because pulmonary exacerbations are linked to later FEV1 decline in CF patients. Corbus' phase 2 study results, though, simply don't provide enough data to prove the efficacy of anabasum on this front.

What's next?

The company's positive spin about those phase 2 CF results is understandable, but there's the matter of cash to consider. Corbus reported $15 million at the end of 2016. The company recently raised another $27 million or so in a stock offering. However, the combined amount is only enough to fund operations through late 2018. 

Corbus expects to announce data from another phase 2 study of anabasum in treating dermatomyositis in the third quarter of this year. The National Institutes of Health is funding that study as well as a phase 2 study of the drug targeting systemic lupus erythematosus (SLE) that should start soon. 

The company announced on April 5 that it was moving forward with a late-stage study of anabasum in treating systemic sclerosis. There's no word from Corbus yet on its plans related to the CF indication. It seems possible that the biotech might decide to put all of its own chips on systemic sclerosis for now. 

Keith Speights has no position in any stocks mentioned. The Motley Fool recommends Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.