Shares of Inhibitex (NASDAQ:INHX) sank yesterday after the release of top-line data of its lead drug, FV-100, for the treatment of shingles. While the results showed improvements in the reduction in the severity and duration of shingles-associated pain of 3% and 7% for the 200mg and 400mg patient cohorts, it was a far cry from the 25% reduction called for as the primary endpoint, and not statistically significant.
The FV-100 Phase II trial was a randomized, three-armed, controlled study comparing two doses of FV-100 to Valtrex, the current standard of care. The compound had never been tested in shingles patients, only healthy volunteers. The rationale for study design and endpoints were therefore somewhat arbitrary, based mainly on preclinical data and results of marketing studies.
In other words, they were going in blind.
Inhibitex had good reason to believe in its molecule; it was extremely potent and fast acting against the Herpes Zoster virus that causes outbreaks of shingles, much more so than current treatments. It had excellent PK and PD properties, allowing once-a-day dosing, compared to the three-times a day treatment with Valtrex.
But the company believed it needed more than a dosing advantage in a marketplace where all three top treatments - including Valtrex - are generic. Market research led it to select pain reduction of 25% over Valtrex as the primary endpoint partially due to the belief that such a large reduction would vault FV-100 into a position to become the standard of care.
It is therefore not surprising that FV-100 missed this artificial goal. The trial did show that Inhibitex has a compound that is at least as good as Valtrex in pain reduction with a similar side effect profile and lower pill burden. What many investors may not have noticed is the 400mg FV-100 cohort had only a 12.4% incidence of postherpetic neuralgia (PHN) compared to 20.2% for Valtrex, one of the secondary endpoints. PHN is the most common complication of shingles and occurs when the nerve pain associated with shingles persists beyond one month, even after the rash is gone.
This is a setback for sure, but FV-100 is in all likelihood an approvable drug. The difference now is a reassessment of its market potential and partnering ability. What management once considered a $1 billion opportunity may no longer exist. It is likely new endpoints will need to be selected for the Phase three to prove superiority, or a higher dose may be used. This is likely to create uncertainty in the trial outcome.
Management spoke of partnering possibilities, suggesting an Asian partner is likely to emerge before any other. Big U.S. and European pharmas certainly seem to have lost interest in primary care drugs; it’ll take gangbuster results to get their attention. In a sane world, pharmas would partner with it before the great results. Inhibitex believes it can take FV-100 into Phase III on its own.
Stealing the spotlight from FV-100 is INX-189, the company’s lead candidate for HCV treatment. The program seemed to come out of nowhere when they first presented data at the 22nd Annual International Conference on Antiviral Research. But as with FV-100, it was in-licensed from the lab of Prof Chris McGuigan of U.K.’s Cardiff University; in this case, in 2008.
INX-189 belongs to a class of RNA nucleotide polymerase inhibitors and appears to be promising. As with all compounds of its class, it has a high barrier to resistance: viruses reproduced for three months in lab tests before a mutant was found. Management claims that their compound is 5-10 times more potent than other compounds in its class.
Phase Ia studies in healthy volunteers have been complete. INX-189 has shown a clean safety profile and good PK sufficient for once daily dosing. A Phase Ib, 7-day trial in treatment naïve patients is now fully enrolled. This trial consists of six cohorts receiving various doses in monotherapy plus two cohorts treated with a combination of INX-189 and ribavirin. Results had been anticipated for the end of this year, but are now expected to roll in through the first quarter 2011 beginning in January. A 12-week Phase II combination study is being planned to follow soon after.
Inhibitex has a rare commodity on its hand with INX-189 and it knows it. There are only a handful of nucleotide polymerase inhibitors in development. The company is planning to develop the compound rapidly. A partner may be considered for Phase II if considered helpful.
After losing 24% in regular trading, the stock has lost nearly all its gains leading up to the FV-100 data release, leaving it with a market capitalization of $136 million. Any value in the company then, appears to be assigned to INX-189.
Buyers of the stock appear to get FV-100 for free.