A Bullish Argument For Cyclacel's Sapacitabine And Seamless

Cyclacel Pharmaceuticals (NASDAQ:CYCC) is currently developing Sapacitabine, an oral nucleoside analogue which interferes with DNA synthesis, for the treatment of elderly AML and MDS. Although the company is currently conducting a large randomized Phase III trial with Sapacitabine in elderly AML as well as several Phase II studies in similar indications, the market has essentially priced the drug for failure. Why? The reason lies with the misunderstood design of the Phase III study - SEAMLESS.

SEAMLESS is a multicenter, randomized, Phase 3 study comparing two treatment arms. In Arm A, Sapacitabine is administered in alternating cycles with Decitabine and in Arm C Decitabine is administered alone. The primary efficacy endpoint is overall survival and the study is designed to demonstrate an improvement in overall survival. Approximately 242 patients per arm, or a total of 485 patients will be enrolled.

The bears contend that the control arm in SEAMLESS, Decitabine administered alone, will ultimately cause the trial to fail. At first glance, one would think they were right. In a 485 person Phase III trial for elderly AML patients titled "DACO-016", Decitabine provided a Median Overall Survival (MOS) of 7.7 months. Meanwhile in Cyclacel's Phase 1/2 clinical trial examining the safety and efficacy of oral Sapacitabine administered sequentially with Decitabine, the same treatment regimen as Arm A in SEAMLESS, the MOS was just under 8 months in 46 enrolled patients. To the casual observer, it would seem the Sapacitabine + Decitabine combo does not add a survival benefit. However, when one takes a closer look at clinical data from the trials, the demographics of each trial, a different conclusion is found.

The key to understanding why Sapacitabine is superior to Decitabine is the enrolled patient's age. In DACO-016, the median age of the 242 patients enrolled in the Decitabine treatment arm was 73. Shown below is a chart of the DACO-016 patient demographics.

We can clearly see from this chart that nearly 30% of the patients treated in the Decitabine arm were less than 70 years old. But in SEAMLESS, the protocol states the patients enrolled must be older than 70. Furthermore, in the Phase 1/2 SEAMLESS pilot study, which provided a MOS of nearly 8 months, the median age enrolled was 77 (range 70-90) with 75% of the patients being 75 or older. Ironically, the 75+ crowd responded even better to Sapacitabine and had a MOS of nearly 9 months. Clearly, Cyclacel is aiming to enroll as many patients as possible that are over 75 in both the Pilot and SEAMLESS study. Interestingly, the median age of death for Leukemia between 2005-2009 was 75, according to government statistics, with the highest incidence occuring in the 75-84 population. Given that older patients do not tend to survive as long with AML as younger do, we can conclude that Sapacitabine is superior to Decitabine (administered alone) in an older population despite having nearly an identical MOS.

There are more statistics from Cyclacel's Pilot study vs. DACO-016 that support this thesis. Below is a slide detailing the survival curve of both arms in the DACO-016 trial.

Click to enlarge

In the Decitabine arm at six months, approximately 57% of the 242 treated patients were still alive, at 12 months 27% and at 18 months only 12%. However, the survival data in Cyclacel's Phase 1/2 Pilot is far more impressive. After six months on Sapacitabine, 65% of those treated were alive, at 12 months 35% and at 18 months 26%.

Now, we can clearly see a significant benefit to Sapacitabine compared to Decitabine. Whereas the short-sighted investor saw no difference in MOS between the DACO-016 trial vs. Cyclacel's Phase 1/2 Pilot and suggested the inevitable failure of SEAMLESS, it now becomes obvious that SEAMLESS stands a much greater chance of producing a clinically meaningful survival benefit compared to Decitabine. In fact, the design of the SEAMLESS trial was perhaps ingenious in respect to the eligibility criteria, as Decitabine is far inferior to Sapacitabine on a number of secondary endpoints including CRs, PRs and HIs. In the DACO-016 trial, only 18% (38 CR, 5 PR) of patients had a Complete or Partial response. In Cyclacel's Pilot study, a staggering 41% of the 46 enrolled had some sort of response (10 CR, 4PR, 5HI).

In summary, Sapacitabine, an orally administered drug with minimal toxicity and superior efficacy, has the potential to change the treatment paradigm of elderly AML if replicated in the SEAMLESS trial. With the approaching final data from Cyclacel's Phase II MDS trial, Sapacitabine stands a good chance to regain investor interest and excitement in the leukemia space.

Disclosure: I am long CYCC. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.