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Shareholders of Anthera Pharmaceuticals (NADSAQ: ANTH) have been in for a volatile November.

After very gradual downward movement throughout the month of October, we saw shares jump over 20% throughout November 1st and 2nd. This bullish move was attributed to a press release on November 1st that announced a clinical trial data presentation of the finished PEARL-SC study that was scheduled for the 2012 annual meeting of the American College of Rheumatology and the Association of Rheumatology Health Professionals (or ACR/ARHP) - scheduled for November 10-14th. The organized phase IIb results, which were already publicly available months ago, will still be able to garner some extra (and much needed) attention for Anthera's blisibimod in the treatment of systemic lupus erythematosus.

Considering that Anthera only has one clinical program (the blisbimod program for lupus), it's clear that any news on this lone drug will be a big mover of the stock. This was made very apparent on June 27th, when we saw a monstrous 70% drop from $2.75/share to about $.81/share after the initial release of the PEARL-SC phase IIb clinical trial data.

Although blisibimod did show some favorable results, the primary endpoint that was based on the "SLE responder index" for the pooled blisbimod dosage groups was not met. Although the safety data that was collected implied that blisbimod is very well tolerated, with no major imbalances in the patients' serological (serum) measurements, the market is quick to label any clinical trial that fails to meet its primary efficacy endpoint as a disaster. Anthera was basically left for dead and dismissed due to the headline announcements.

Although there's no doubt that the PEARL-SC trial was technically a failure due to the statistically measurements that we use to gauge clinical trial data, it's apparent that healthcare regulators did see some potential in blisbimod. I'll now explain why all is not lost for Anthera's lupus drug, despite what the market seems to think.

As confirmed in the press release that initially unveiled the data for PEARL-SC, the EMA (European Medicines Agency) gave Anthera confirmation that the drug could move into phase III clinical trials based on designs that were submitted to bring blisbimod towards a MAA (Marketing Authorization Application.) Months later, specifically in this September 17th press release, we saw that the FDA decided to the extent Anthera the same courtesy, which will allow Anthera to proceed in the United States as well. Belisbimod, initially left for dead by the market, is basically getting a second chance.

Anthera can use the results from the PEARL-SC study to refine their phase III trial for blisbimod too, which improves the chances for its success later on. According to company statements, the company now knows more about selecting an appropriately large patient population and on selecting a good endpoint that can prove the drug's efficacy. PEARL-SC had a total of 547 patients with SLE, and were randomized into three blisbimod dosage arms and a placebo arm. Improvement was measured using SELENA-SLEDAI, which is a universal scale that is used to measure the existence (or lack of) lupus symptoms.

What was especially interesting were the results for patients that were part of the SRI-8 category. The SRI categories were made to further organize patients - specifically by the improvement in SELENA-SLEDAI scores. Patients that were in SRI-5 (those who didn't do as well) underperformed SRI-8 (the best performers) by a very significant margin. According to the company's own analysis, this means that those who respond to blisbimod's mechanism see especially positive results.

"In fact, the SRI-8 data, representing an improvement in SELENA-SLEDAI of eight points or greater achieves statistical significance at multiple time points including at 24 weeks. Due to the consistently better effects at higher thresholds, it appears that if a blisibimod patient responds, they respond very well" said Dr. Colin Hislop - Anthera's Senior Vice President and Chief Medical Officer

After we got more results on the PEARL-SC trial, it became a bit more obvious that the trial's failure was also due to some misunderstanding of how blisbimod affects lupus patients. Blisbimod works specifically through the BAFF (B-cell Activating Factor) pathway, which is associated with a variety of autoimmune diseases including lupus. The causes of Systemic Lupus Erythematosus (or SLE) isn't fully understood, but it seems that the patients that are majorly affected by BAFF can see major benefit by taking blisbimod.

It seems that the market still hasn't forgiven blisbimod for the PEARL-SC results, although it can be argued that the results were ultimately successful for Anthera's long-term strategy. Not only did the phase IIb results allow the drug to continue onto phase III development in both the EU and the United States, but it provided some valuable data on the efficacy of the drug that will help the company prove its efficacy with "statistically correct measurements" later on. If you believe that Anthera was fairly valued prior to June 28th, the company is a deep value play that will require a bit of patience.

There is one thing that investors should consider before going long on Anthera though. Any stock that trades below $1/share like ANTH has an exceptionally high implied level of risk, and trades more volatile than most stocks out there. There is also NASDAQ delisting, which is a threat for any sub $1/share stock that doesn't move above $1/share for at least ten consecutive trading sessions in a 6-month period. Do take the potential for ANTH to be delisted into consideration.

Source: Anthera's Lupus Drug Gets Second Chance After Clinical Trial Disaster