The German biotech sector took a hit yesterday, after GPC Biotech (NASDAQ:GPCB) and partner Pharmion (NASDAQ:PHRM) announced that GPC's lead drug, satraplatin, had failed an important endpoint in phase 3 testing.

Satraplatin is a chemotherapeutic drug currently in clinical trials in relation to various cancers. After an interim analysis of an ongoing phase 3 study showed that satraplatin was successful in improving progression-free survival (PFS) in patients with late-stage prostate cancer, GPC filed a marketing application with the FDA in April.  

But an FDA advisory committee in July wasn't swayed by the PFS data, which used a non-standard definition of the endpoint. The advisory panel thus recommended that the FDA refrain from allowing the drug to hit the market until successful overall survival data for the phase 3 study came out.

The news doesn't get better. GPC announced yesterday that satraplatin failed miserably versus a control group in improving overall survival in the prostate-cancer study. Patients treated with satraplatin lived an average of 61.3 weeks, whereas patients receiving standard-of-care therapy lived 61.4 weeks with a p-value of 0.80 -- that is, there's an 80% chance that the 0.1 week difference is due to chance.

Yet that wasn't necessarily the surprising news. Drugs fail in testing all the time, and other cancer compounds -- such as Amgen's (NASDAQ:AMGN) Vectibix -- have succeeded in improving PFS, but failed to improve overall survival in other studies.

Instead, the surprise was the magnitude of the satraplatin failure. Patients in this large 950-person study treated with satraplatin experienced essentially zero improvement versus the standard of care. Even at the previous interim analysis, patients treated with satraplatin were surviving an average of 61.8 weeks, compared with 58.7 weeks for the placebo group, and it looked as though the trend would improve over time.

One theory that GPC and Pharmion were bantering about is that the approval of Sanofi-Aventis' (NYSE:SNY) Taxotere, which occurred after this study began, may have affected the results if patients in the control group received Taxotere in a greater percentage than in the Satraplatin arm.

Since the data just came in only yesterday, GPC doesn't yet have any updates on this theory or the other numerous pre-specified subgroup analyses planned for the study. More information is expected on Nov. 8, during GPC's quarterly conference call.

GPC already pulled its marketing application for satraplatin with the FDA following the negative panel vote, but Pharmion and the original developer, Spectrum Pharmaceuticals (NASDAQ:SPPI), still have their European Union application pending. The results obviously hurt satraplatin's odds at the European Medicines Agency in a major way, and if Pharmion senses that the review process isn't going well, it may pull the drug's marketing application there.

Satraplatin is still in testing for treating other solid tumors, with phase 1/2 and phase 2 data expected to roll in over the next eight months. Regardless of how good this data turns out, unless there was some serious imbalance between the number of placebo patients who received Taxotere in the prostate-cancer study or anther good explanation, GPC's satraplatin program appears to have taken a hit that could set it back several years.

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Fool contributor Brian Lawler does not own shares of any company mentioned in this article. The Fool has a disclosure policy.