Shares of ArQule (NASDAQ:ARQL) rose over 44% today after the company announced interim data from an ongoing phase 1 clinical trial for ARQ 531 in blood cancers. The proof-of-concept data offers a promising glimpse of the drug candidate's potential to treat a wide range of cancers affecting white blood cells, including chronic lymphocytic leukemia (CLL) and B-cell non-Hodgkin lymphomas.
The company is now looking to complete the phase 1 trial, collect data on eight different once-daily doses, and determine the proper dose or doses that will be evaluated in a larger phase 2 trial. ArQule also intends to develop ARQ 531 as a stand-alone treatment and in combination with other therapies.
As of 11:14 a.m. EDT on Friday, the stock had settled to a 36.2% gain.
Today's news suggests that the hypothesis supporting the development of ARQ 531 has merit. When an existing treatment doesn't wipe out all of the cancerous white blood cells in the body, it's often because a few surviving cells have mutated resistance to the treatment. The most common mutation occurs in the BTK protein, which is the target of existing treatments. However, because existing drugs bind to sites on the protein irreversibly (read: they lock on and never let go), the mutation allows the cancer cells to brush off attack.
ARQ 531 is a reversible BTK inhibitor, meaning it latches onto the protein for a period of time, but eventually lets go. It can also bind to both unmutated and mutated forms of the BTK protein. On paper, that mechanism of action should allow the drug candidate to attack blood cancers that have become resistant to other treatments and also avoid triggering resistance (through the BTK protein, at least).
The initial data, albeit from a small population of patients, supports the paper hypothesis. ARQ 531 invoked a partial response in four of six patients who had been treated unsuccessfully with other drugs. The drug candidate was well tolerated. And one patient has even maintained a partial response after two years of treatment.
ArQule ended the first quarter of 2019 with $92 million in cash on hand, but investors shouldn't be surprised if management wisely takes advantage of a soaring stock price to pad the balance sheet with even more capital from a public stock offering. After all, the company's early stage pipeline will be expensive to develop. But if the pipeline continues to impress with results similar to those reported for ARQ 531, then Wall Street might be all too happy to go along for the ride.