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ArQule (ARQL) just cannot seem to get any satisfaction from its c-Met kinase inhibitor tivantinib. Even worse for the Massachusetts biotech, its shares have taken a hit despite the latest failure coming in a study with little practical relevance - a phase I/II three-agent combo in colorectal cancer.

ArQule's stock closed down 12% at $2.58 on Friday, wiping out many of the small gains made since tivantinib's far more important phase III lung cancer setbacks. Investors who remain interested in what is now the project's key focus, liver cancer, might see this as a buying opportunity, and will take heart from ArQule's other main asset - $83m of third-quarter cash.

The second-line colorectal study, conducted by ArQule's partner Daiichi Sankyo (OTC:DSNKY), failed to show statistically significant improvement in either its primary endpoint, progression-free survival, or objective response rate, a key secondary, although both measures numerically favoured tivantinib. Another important secondary endpoint, improvement in median overall survival, will be announced later since the treatment arm has yet to reach the median, ArQule said.

Largely academic

However, all this is largely academic given that the trial concerned the addition of tivantinib (ARQ 197) on top of irinotecan and Eli Lilly's (LLY) Erbitux. When the study was designed back in 2009 the irinotecan-Erbitux combo was an important standard of care.

But since then colorectal cancer drug development has moved along, culminating in last year's approvals of Onyx Pharmaceuticals (ONXX)/Bayer's regorafenib and Sanofi (SNY)/Regeneron's (REGN) Zaltrap. Even before it failed, the triple-agent phase I/II study was no longer seen as capable of generating a result that could have been taken into phase III, ArQule said on a conference call.

Moreover, there are other reasons why tivantinib failed in this setting. The study design had called for enrolment of 150 patients but in the event only 122 were recruited, possibly compromising the powering, and there was a high degree of heterogeneity in the treatments patients had taken first line.

ArQule's stock had crashed last autumn, losing two thirds of its value in six weeks when tivantinib's development in NSCLC took a double hit. First the Asian phase III Attention trial was halted after suspected cases of interstitial lung disease - it has yet to be resumed - and then the bigger Marquee study was stopped for futility (Double clue dashes ArQule's lung cancer hopes, October 3, 2013).

Since then analysts' forecasts for tivantinib have understandably plummeted: in August EvaluatePharma saw consensus sales of $229m in 2018, but this now stands at just $34m, equivalent to a risk-adjusted NPV of $273m. Leerink Swann said it had not carried any colorectal cancer revenue in its forecasts.

Instead, hopes for the molecule have come to rest on hepatocellular carcinoma, in particular in c-Met-positive tumours, a setting in which positive phase II data were reported at last year's Asco. Metiv, a 303-patient phase III monotherapy trial in second-line treatment of Met-high liver tumours, recently started patient recruitment, according to Clinicaltrials.gov.

Rather than reflecting a major opportunity missed, the latest share price dip must therefore be a general sign of waning sentiment around tivantinib. At least ArQule does not need to go back to investors for more cash just yet.

StudyTrial ID
Phase I/II study in 122 2nd-line colorectal cancer patientsNCT01075048
Source: Latest Tivantinib Failure Hits ArQule Despite Its Irrelevance