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Iclusig works in CML when nothing else does

Hematologists and chronic myeloid leukemia (CML) patients are anxiously waiting for Iclusig (ponatinib), a new drug from Ariad Pharmaceuticals (NASDAQ:ARIA).

They don't need to wait much longer: the FDA just approved it 3 months ahead of schedule and it will be available in a couple of weeks.

Iclusig is approved to treat adults with CML and Philadelphia chromosome positive acute lymphoblastic leukemia (Ph+ ALL), two rare blood and bone marrow diseases. It carries however a Boxed Warning alerting patients and doctors that the drug can cause blood clots and liver toxicity.

Why a new drug is needed

A mutation, called T315I, along with some others cause about 10 to 20 percent of all CML patients to become drug-resistant to current medications in five years from starting treatment, and it causes drug resistance in about 50 to 60 percent of ALL patients within one to two years.

Iclusig is the only drug right now that is able to handle T315I.

The introduction of Gleevec by Novartis (NYSE:NVS) some years ago revolutionized the treatment of CML.

Today approximately 90 percent of patients suffering from CML survive for at least five years, up from 50 percent before Gleevec. Gleevec is a terrific drug, however 30 percent to 40 percent of CML patients eventually become resistant to it.

Two newer drugs, introduced in recent years, Tasigna, also from Novartis and Sprycel from Bristol-Myers Squibb (NYSE:BMY) are more potent than Gleevec. Each can be used in frontline therapy.

Tasigna and Sprycel work for 40 percent to 50 percent of the patients that became resistant to Gleevec.

If you put those two lines of therapy together, most patients do well. However, that is no consolation to all of those who are not doing well, and that's where Iclusig comes in.

Blood cancer CML

Each year, about 5,000 Americans are diagnosed with the often fatal disease, known as CML, a cancer of the white blood cells.

CML is caused by the abnormal gene BCR-ABL, which occurs when two chromosomes swap portions of their DNA from the BCR and ABL genes during cell division. This abnormality is called the Philadelphia chromosome and the resultant BCR-ABL fusion protein causes an excessive and unregulated production of white blood cells by the bone marrow.

Ph+ ALL is a more aggressive course than CML and is often treated with a combination of chemotherapy and tyrosine kinase inhibitors.

Phase 2 (Pace) trial

"We have simply never had any treatment produce such high rates of durable response in a heavily pretreated group of patients," said Jorges Cortes, MD, professor at the University of Texas M.D. Anderson Cancer Center in Houston.

Recently Dr. Cortes presented preliminary results from the phase 2 Pace trial at the American Society of Hematology Meeting.

The trial has shown that Iclusig works in patients who are resistant to or cannot tolerate other therapies, and confirms the efficacy seen in the recently published phase 1 clinical trial, published in the New England Journal of Medicine.

The Pace trial was conducted in Europe and the United States in 449 patients with CML or with ALL.

All patients had been heavily pretreated: most patients (96%) had received Gleevec, 84% had received Sprycel, 65% had received Tasigna, and some patients had received the newest agent, Bosulif, made by Pfizer (NYSE:PFE).

Almost one third of patients had the T3151 mutation, a few other mutations were also found, but 44% of patients had no mutation.

For patients with chronic-phase CML (270 of 449 participants), the primary end point was a major cytogenetic response within 12 months of treatment (where more than 65% of cells are normal). This was achieved in 55% of chronic-phase CML patients.

These responses are durable. It is estimated that the major cytogenetic response will be sustained at 12 months in 91% of patients with chronic-phase CML.

Remarkably, a complete cytogenetic response (no Ph+ cells measured in the body) was achieved in 46% of patients with chronic-phase CML, and even higher response rates were observed in patients who had a shorter duration of disease.

For patients with accelerated-phase CML (85 patients) or blast-phase CML/Ph+ ALL (94 patients), the primary end point was a normal white blood cell count within 6 months of treatment. This was achieved in 58% of patients with accelerated-phase CML and in 34% of those with blast-phase CML/Ph+ ALL.

Dr. Cortes reported that the responses were similar in patients with and without the T3151 mutation, which shows that Iclusig works across a wide range of drug resistance, whether or not a mutation is present.

Iclusig may be able to transform this highly fatal form of leukemia into a curable disease.

The next step is to test Iclusig's potential as a first line therapy in an attempt to prevent the occurrence of relapse.

Ariad's phase 3 trial, known as Epic, is already underway. Epic is comparing Iclusig with Gleevec in newly diagnosed chronic-phase CML patients.

Competition

The FDA approved Bosulif from Pfizer in September 2012 and Synribo from Teva (NYSE:TEVA) in October 2012 to treat various phases of CML. Marqibo injection from Talon Therapeutics (OTC:TLON) was approved in August 2012 to treat Philadelphia chromosome negative ALL.

Bosulif and Iclusig are currently used as third-line treatment in patients who fail on second-line therapies, and are being explored as second-line therapies in their own right.

While both drugs are designed to treat the same group of patients, the widening range of therapies is allowing oncologists to consider adverse events, mutational status, and dose scheduling to select the best treatment possible for a patient.

Investor's summary

For two decades in Ariad's existence, company scientists have labored at designing drugs and identifying diseases to target, while its investors have waited and waited and waited for Ariad's first product to hit the market.

Now the waiting is over.

While the FDA approved Iclusig as a "third line" drug initially, it has the potential to soon become a "first-line" therapy, given to leukemia patients from the start of their treatment.

That would give Ariad access to a larger share of the estimated $4.5 billion annual chronic myeloid leukemia market now dominated by Gleevec, Tasigna and Sprycel.

Ariad had a net loss for the third quarter of $53.2 million or $0.32 per share compared to net income of $13.9 million or $0.10 per share for the same period in 2011, reflecting expansion of development activities for Iclusig and another new compound AP26113, an increase in personnel and related expenses.

At the end of September, the company had cash and cash equivalents of $206.7 million compared to $306.3 million at December 31, 2011.

Ariad's share price ranged from $10.41 to $25.40 in the past 52 weeks.

"Iclusig is a best-in-class drug and a potential first-line therapy with very compelling efficacy," said analyst Michael J. Yee with RBC Capital Markets in San Francisco. "What's very interesting about Ariad is that they are the rare biotech that has decided to retain worldwide commercial rights to their drugs. That could be particularly valuable in the future."

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Source: Ariad's Wonder Drug For Leukemia Patients