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Thursday, we saw shares of the developmental biopharmaceutical company Repros Therapeutics (NASDAQ: RPRX) close over 76% higher by the closing bell, reacting to a press release issued by the company after Wednesday's trading. In it, the company revealed top-line data for the first pivotal trial conducted for their oral small molecule drug Androxal (enclomiphene citrate) called "ZA-301". The first primary endpoint was based on the exhibition of normal testosterone levels (300-1040 ng/dL) in at least 75% of the Androxal arm, which was achieved at the end of the 12 week regimen. The endpoint was met successfully, with 79% of Androxal arm patients achieving regular testosterone levels.

Another primary endpoint referred to as the "Sperm Endpoint" was established (a co-primary endpoint) by the FDA in order to demonstrate Androxal's non-inferiority to the placebo treatment in patients who had dropped 50% of baseline levels or lower after the trial as measured by sperm count in patients. The Androxal arm had to outperform the placebo arm by a 20% margin, which was consistent with the notion that the drug increases levels of follicle-stimulating hormone (FSH). This was generally seen as the endpoint that would make or break ZA-301, which implies that this new rally in RPRX is primarily based on success in the sperm endpoint.

ZA-301's top-line data currently implies that the drug will be able to progress to an eventual FDA approval, although there's much more to the story. The recent move in RPRX to the upside erases the damage that had been done in late January 2013 caused by this press release, which implied that there may be some problems with baseline testosterone level data due to the suspiciously low levels seen at one of the sixteen sites that ZA-301 was conducted at.

Since the FDA would most likely see this as a red flag that threatens the validity of the entire study, Repros replaced these patients and delayed the guidance for data release from this trial.

The company originally expected to release top-line data from ZA-103 in Q3 2013 due to this, although we ended up getting it in early Q2. Whether this is because of a declining share price in RPRX or because of early availability of data isn't certain at this point, although the recent development seems to have reassured investors about Androxal for the time being. Having said this, I think there is some lingering skepticism over Androxal's clinical trial data that could get in the way of FDA approval down the road.

There is also some skepticism over the performance that Androxal may have after potential FDA approval due to the existence of the selective estrogen receptor modulator (SERM) Clomid (clomiphene citrate). Androxal is a purified version of clomiphene which contains only the trans isomer (enclomiphine), which is supposed to have less estrogenic activity than the cis isomer. This makes Androxal superior to Clomid in theory, although evidence supporting this notion is limited.

Androxal has had a difficult development process in the last few years, although the recent top-line data for ZA-103 should bolster the market's support for the company as it heads closer to an NDA submission. The drug is safe, and seems to have proven an aspect of its mechanism of action with the successful completion of the sperm count endpoint in the recent phase III. Repros also has strong institutional backing, and may be able to secure non-dilutive financing before its current cash pile runs out in 2014 (estimated), which is of course very good for RPRX shareholders.

On the bearish side, I think that the FDA might have reasons to issue a CRL given the profile we currently have for Androxal. On top of the revealed discrepancies we saw with the phase III data back in January, we saw that Repros added men who had dropped out before their first visit in the ZA-103 trial (and at other intervals) had their data pooled into the baseline data measurements. Since Repros doesn't use a clinical research organization (CRO) to do its trials, the FDA may have increased scrutiny on questions brought up on Androxal's data.

For the time being, I think RPRX should hold (or even move up) on the latest developments, although it's become expensive again. Also, keep an eye out for the release of the full data from ZA-103. This will further solidify or deteriorate the increasingly strong efficacy profile we have for Androxal.

Source: Repros Moves Up On Phase III Data, Both Co-Endpoints Met