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An international Phase IIb trial of INNO-206 initiated for soft tissue sarcoma

On December 22, 2011, CytRx (NASDAQ:CYTR) announced that it has initiated an international Phase IIb clinical trial to evaluate the preliminary efficacy and safety of its tumor-targeting doxorubicin conjugate INNO-206 in patients with late-stage soft tissue sarcoma.

The Phase IIb clinical trial will provide the first direct clinical trial comparison of INNO-206 with native doxorubicin, which is dose-limited due to toxicity, as a first-line therapy.

The Phase IIb clinical trial with INNO-206 in patients with soft tissue sarcomas is an international trial under the direction of Sant P. Chawla, M.D., F.R.A.C.P., Director of the Sarcoma Oncology Center in Santa Monica, Calif. Dr. Chawla also is acting as principal investigator for the company’s ongoing Phase Ib/II clinical trial with INNO-206.

The Phase IIb clinical trial’s primary objectives are to measure the progression-free survival, tumor response and overall survival of patients with advanced soft tissue sarcomas treated with INNO-206. This clinical trial also will assess the safety of INNO-206 compared to doxorubicin in this patient population through a number of indicators, including the frequency and severity of adverse events.

The open-label trial will enroll 105 patients with metastatic, locally advanced or unresectable soft tissue sarcoma at approximately 30 study centers in the U.S., Hungary, Romania, Ukraine, Russia, India and Australia. Patients will be randomized into two groups with twice as many receiving INNO-206 as doxorubicin. Patients will be treated intravenously once every 21 days for up to eight consecutive cycles with INNO-206 administered drug at 350 mg/m2 (260 mg/m2 doxorubicin equivalents) and doxorubicin administered at 75 mg/m2.

Doxorubicin is currently the only FDA-approved drug on the market as a treatment for soft tissue sarcoma and is a standard chemotherapy for a variety of other cancers. It is used either alone or in combination with other chemotherapy agents. Dose levels of doxorubicin are limited due to its toxicity. INNO-206 is a novel conjugate of doxorubicin that binds covalently to albumin, and is circulated throughout the body. INNO-206 is designed with a linker that releases doxorubicin in the low pH environment of tumors, concentrating the chemotherapeutic agent where it preferentially damages the tumor while minimizing the effect on healthy tissues.

Favorable results reported from initial Phase Ib/II trial of INNO-206

The international Phase IIb trial is based on favorable Phase Ib/II trial.

In October 2011, CytRx announced positive results from the company’s ongoing Phase Ib/II clinical trial with INNO-206 from a group of patients with advanced solid tumors, principally soft tissue sarcomas. The patients from the early portion of the trial were evaluated for tumor response after four cycles of INNO-206. Total of 24 patients will be enrolled in the Phase Ib/II trial.

Of five patients who have completed four cycles with INNO-206 at the maximum tolerated dose, one patient has exhibited a partial tumor response (greater than 30% tumor shrinkage) and four patients have stable disease. A large, painful oral sarcoma that caused difficulty eating in one patient was greatly reduced following a single INNO-206 treatment. Common side effects reported to date from the Phase Ib/II trial include low neutrophil and platelet counts, minor mouth ulcers and mild nausea, which are expected side effects of doxorubicin.

CytRx is currently enrolling additional patients who will be treated at that dose to gather further response data in parallel with the newly initiated international Phase IIb clinical trial.

We think the initial data for INNO-206 are impressive. Although these initial results are from a limited number of patients, the individuals treated were very advanced in their disease and had previously received multiple different chemotherapy agents, including doxorubicin. These early indications may bode well for the potential success of the international Phase IIb clinical trial in patients who have advanced disease but were not previously administered chemotherapy.

Relatively decent pipeline

CytRx recently reported updated positive data at 2011 ASH annual meeting from its ongoing Phase II trial of Bafetinib for the treatment of B-CLL. Currently, the company has 7 clinical trials in Phase II and one clinical trial in Phase I. The following table summarizes the company’s relatively decent pipeline.

CytRx Development Pipeline

Technology

Product Candidate

Indication(s)

Stage of Development

Synthetic retinoid

Tamibarotene

Non-small-cell lung cancer

Phase IIb

APL (acute promyelocytic leukemia)

Pivotal Phase II

Tamibarotene/Trisenox

APL

Phase I/II

Tyrosine kinase inhibitor

Bafetinib

B-CLL

Phase II

Advanced prostate cancer

Phase II

Brain cancer

Phase I

Doxorubicin Pro-drug

INNO-206

Soft tissue sarcomas

Phase IIb

Pancreatic cancer

Phase II (1H12)

The progress CytRx has made so far to advance its pipeline is impressive and encouraging. We think the company is heading in the right direction. With positive data for its lead candidates Bafetinib and INNO-206, the company plans to expedite the development of these therapeutic programs.

In addition to a relatively pipeline, CytRx has a relatively strong balance sheet which sets it apart from most small cap biotech companies in the industry. As of September 30, 2011, CytRx held cash, cash equivalents and marketable securities of $41.4 million. There was no debt on the balance sheet. Current liquidity source will be sufficient to fund operations for the foreseeable future, probably to the end of 2012 according to our financial model.

Based on the relatively strong fundamentals, we have an Outperform rating on CYTR.

Of course, risk is also high for CYTR as for most other small biotech companies. Investors should balance their return expectations and risks in the context of portfolio.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: CytRx Continues To Make Progress To Advance Its Pipeline