Roche, Biogen Suspend Experimental Treatment: Biotech's Latest Mishaps

by: The Burrill Report

Roche (OTCQX:RHHBY) and Biogen Idex (NASDAQ:BIIB) said they suspended Ocrelizumab, their experimental treatment for rheumatoid arthritis following the recommendation of an independent data and safety monitoring board. The board concluded that the risks outweigh the benefits in the patient population targeted by the drug. Some patients using the drug suffered serious opportunistic infections, some of which were fatal. Ocrelizumab was viewed as a possible successor to Roche’s Rituxan.

ExonHit Therapeutics (OTC:EXHTF) and bioMérieux said they have decided not to pursue their collaboration in colon cancer, following a recent review of data by their scientific committee. Both companies continue to collaborate in the field of prostate cancer. “ExonHit’s technology was able to produce a robust and reproducible test however, the final results from the colon cancer program did not reach the level of performance we were aiming to achieve,” said Loïc Maurel, president of the management board of ExonHit Therapeutics. ExonHit and bioMérieux collaboration is dedicated to the discovery of biomarkers for the detection of certain cancers.
XenoPort (NASDAQ:XNPT) said it would eliminate about half of its 220-person workforce as part of a restructuring designed to focus the company’s resources on advancement of its later-stage product candidates. On February 17, 2010, the U.S. Food and Drug Administration issued told the company it would not approve at this time the company’s application to begin marketing Horizant, an experimental, non-dopaminergic treatment for moderate-to-severe primary restless legs syndrome. The Company expects to incur cash expenditures in the first half of 2010 of up to $4.2 million related to the restructuring, which will partially offset the savings in 2010. The Company also expects to incur additional non-cash expenses as a result of the restructuring. “The unexpected setback in the approval of Horizant has forced us to conduct a thorough review of our operating plans,” said Ronald Barrett, XenoPort’s CEO. “We have made the difficult decision to restructure the company to prioritize later-stage development activity and eliminate our discovery research efforts.”
Exelixis (NASDAQ:EXEL) said it would eliminate about 270 employees or 40 percent of its workforce as part of a strategy to focus resources on the development of its key late-stage compounds. The company said it will aggressively advance XL184, XL147 and XL765, each of which is the subject of a large clinical development program. Additionally, Exelixis retains a fully integrated R&D organization, and will continue to advance new compounds into development, although the number will be reduced for the foreseeable future. Exelixis has retained the ability to meet all of its obligations to existing partners. Further, as a result of its retained R&D capabilities and its numerous unpartnered clinical and preclinical compounds, the company expects that its ongoing and future business development discussions will be unaffected. Exelixis said the restructuring will reduced its cumulative cash expenditures through 2011 by approximately $90 million after payment of restructuring costs. The savings are primarily related to reductions in compensation and benefits, laboratory supplies, and clinical trial costs. The company expects to record a restructuring charge of approximately $15 million in the first quarter of 2010, which may increase later in the year, depending on potential facility-related charges and other write downs that have not yet been finalized.
The Board of Ark Therapeutics has withdrawn its application with European regulators to begin marketed the brain cancer treatment Cerepro. A scientific advisory group to the European Medicines Evaluation Agency recommended an additional clinical trial before the product could be approved. Following the withdrawal of the Cerepro application, Ark said it has initiated a full review of its portfolio of assets, potential and alternative strategies, and options to optimize shareholder value. The review will also consider strategic alternatives in light of offers that have already been received. The company has received a number of offers and has initiated further discussions with a number of parties, which it said may or may not lead to an offer being made for the company.
AutoImmune said that its board of directors has decided to liquidate the company after consideration of potential strategic alternatives. The decision follows the failure in July of the company’s experimental multiple sclerosis drug in a late-stage trial. In connection with the liquidation, the Pasedena, California-based company intends to distribute to its stockholders all available cash, except such cash as is required for paying or making reasonable provision for the liabilities and other obligations of the company. The company intends to call a special meeting of the stockholders to seek approval of a liquidation plan. If the plan of liquidation is approved, the company also intends to close its stock transfer books and to discontinue recording transfers of its stock.
Neuropharm Group said it is considering a voluntary liquidation in the face of a lack of offers from ongoing talks with potential buyers. The specialty pharmaceutical focused on neurodevelopmental disorders has been in discussions with a number of parties since it entered an offer period in November 2009 and announced that it was pursuing a proposed sale or merger of the company. The Company is continuing talks with a potentially interested party, which is in the advanced stages of due diligence, but no offer has yet been received. The company said it has significantly reduced its cash burn and, as of the end of 2009, had unaudited cash, cash equivalents and money market investments of $9.4 million.