It is hard to know whether Nektar Therapeutic’s (NKTR) 26% share price plunge this morning is down to disappointment about the failure of its phase II pain candidate, or horror that the company sees no reason why it should not push on with a pivotal study.
A CNS drug failing to show a benefit due to a surprisingly strong placebo effect – as Nektar claims happened with NKTR-181 – is not an unusual occurrence. But company executives said yesterday that the efficacy signals were still strong enough to warrant moving forward, and implied that the only remaining barrier to success was coming up with a trial design to overcome that destructive placebo signal. They also estimated that a pivotal study would cost around $100m. No wonder investors chose to flee.
Unusual lack of rebound
NKTR-181 is a mu-opioid receptor agonist developed using Nektar’s polymer conjugate technology and designed to promote a much slower release of the active agent into the brain compared with standard opioid-based analgesics. The company says this has the effect of substantially reducing the CNS side effects associated with this class, primarily sedation and dizziness, and makes it much less attractive to drug abusers – the slow rate of entry prevents the rush and euphoria that abusers seek.
The phase II study just reported, in patients with moderate to severe chronic pain caused by osteoarthritis of the knee, followed a so-called randomised withdrawal design. This involves a run-in in which the active drug is titrated before randomisation and patients that fail to respond or who cannot tolerate the treatment are eliminated, so a more accurate picture of the compound’s activity can be drawn.
This is pretty standard in the testing of opioids – because many patients cannot tolerate the side-effects of this class, a high proportion tend to withdraw from the active arm, accentuating any placebo effect and derailing the outcome.
But despite the run-in, in Nektar’s trial of NKTR-181 the average change in a patient’s pain score from pre-randomised baseline to the end of the treatment period – the primary endpoint – showed no difference between active and placebo arms.
Of the 295 patients originally recruited, 213 achieved an average 40% reduction in pain over the titration period and entered the randomised phase of the study, half being switched to a placebo and half continuing with NKTR-181. The company did not release the final data, but said on a call that that both arms continued to experience around the same level of pain relief over the 21 days of the study.
One explanation the company mooted for this “unusual lack of placebo rebound” was the much lower rate of adverse CNS events recorded in the trial than would normally be seen with this class.
A withdrawal trial design is predicated on a placebo rebound – if that does not happen the trial fails. However one criticism of this design is that patients often become aware they are on placebo because the CNS side effects disappear post randomisation, and their pain scores rebound. Because patients did not receive a strong signal about what arm they were on in the NKTR-181 trial, the cohorts produced similar readings, Nektar execs suggested.
Reason to pause
Nektar apparently feels this explanation to be plausible enough to push forward into a large phase III study. As well as the pain relief measured in the active arm, the company pointed to very low dropout rates during the titration phase of the study, compared to other trials of opioids as further evidence of the drug’s effectiveness and superior tolerability.
However, even if these readings are accurate, the real challenge lies in designing a trial to prove it. The placebo effect has derailed many a promising project and foxed many a smart company. And then Nektar still has to convince the FDA that NKTR-181 is less attractive to abusers.
Talks will now be held with regulators but the company sees no reason why phase III could not start early next year.
“What we have learned should be enough to allow us to put together a successful phase III programme,” Howard Robin, chief executive, said on the call. “We don’t see any reason to go backwards.”
The $100m that Mr Robin estimates a pivotal trial will cost is one big reason why investors might prefer Nektar to at least stand still, and perhaps first test any new trial design more modestly.