Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Although Ziopharm Oncology (NASDAQ:ZIOP) announced that it has begun enrolling patients in a key clinical trial, the company's shares fell by 10% earlier today.
So What: Enthusiasm that the company's oncology program could eventually lead to next-generation cancer fighting compounds that work better and are less toxic has sent shares in Ziopharm Oncology soaring this year.
The company has announced a slate of immuno-oncology news this year, including collaborations with the MD Anderson Cancer Center and the German-based Merck Serono to develop CAR-T based therapies that involve reengineering the body's immune system to better identify and kill cancer cells.
The commencement of patient enrollment announced today by Ziopharm was for its phase 1/2 trial of Ad-RTS-hIL-12 for the treatment of breast cancer. That compound is being dosed along with veledimex in 40 patients who have previously received chemotherapy. Although the primary endpoint of this trial will be safety and tolerability, secondary endpoints include overall response rate and disease control rates.
Now What: The potential to develop therapies that can reduce, or potentially eliminate, the need for highly toxic chemotherapy regimens is endlessly intriguing; however, investors are probably right to be taking a little risk off the table.
Historically, 93% of cancer drugs entering phase 1 trials end up failing and being discarded, suggesting that there's a significant headwind that Ziopharm will need to overcome.
Investors should also know that there are a number of competitors that are similarly developing CAR-T therapies.
Since research into CAR-T therapies remains in the early stages, there's considerable risk associated with Ziopharm Oncology, and that means the company is likely best suited for those who can tolerate a healthy dose of risk in their portfolios.
Todd Campbell has no position in any stocks mentioned. Todd owns E.B. Capital Markets, LLC. E.B. Capital's clients may or may not have positions in the companies mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.