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REOLYSIN(R) Nearing The Big Hurdle

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 Although Oncolytics Biotech’s REOLYSIN(NYSE:R) has not shown itself to be a “silver bullet” that many cancer researchers have been searching for, if it eventually gains approval by the U.S. Food and Drug Administration (FDA), it likely will succeed in proving to be a first in class, and best in class cancer treatment for the majority of cancers until a superior treatment is developed.  In my opinion, it will provide valuable time for very ill cancer patients, time to hopefully stabilized their disease similar to what has occurred in the treatment of HIV, which originally was thought of as a “death sentence” for those infected. REOLYSIN(R) is not yet been approved for use by the FDA but is about to face the crucial hurdle, a Phase III trial.  

Dr. Brad Thompson CEO and President of Oncolytics, in a conference call Friday, announced that the company and the FDA have reached an agreement on their planned pivotal Phase III Clinical Trial. Under the Special Protocol Assessment (NYSE:SPA) process for the trial design, the randomized, two-arm, double-blinded , two stage, adaptive trial will treat patients with platinum-refractory head and neck cancers.  Treatment will consist of  a combination of intravenously administered REOLYSIN(R) with placitaxel and carboplatin, or for the control arm the same chemo agents without REOLYSIN(R).  This upcoming trial is based on the results of their Phase I/II trial treating similar cancers wherein the clinical response benefit rate (complete response + partial response + stable disease) was 75% and many fold improvement over historical results with just chemo agents. Patients enrolled in this planned trial must have failed previous platinum agent chemotherapy and had their cancers reoccur or metastasize. If Oncolytics achieves the agreed endpoints, the primary one being overall survival (OS),  followed by progression free survival (NYSE:PFS), or objective response rate (CR + PR + duration of response), and safety, as well as tolerability, then approval for this unique therapy will be sought and should be approved. 

When I wrote an article for Seeking Alpha, last March 23, Oncloytics (ONCY) was trading at $1.31/share and Friday traded as high as $3.80 before settling back to close at $3.54/share a 20.4 % gain over the Thursday closing price of $2.94.  Since the March article, Oncolytics has continued with other Phase II trials and Dr. Thompson advised that they will continue exploring therapeutic benefits of REOLYSIN(R) with other major types of cancers that are known to have activate RAS signaling pathways.  Patients in late stage major types of cancer are being treated with reovirus to determine efficacy of treatment.  For example, on September 24, Oncolytics announced that the Cancer Therapy & Research Center at the University of Texas Health Science Center (CTRC) has started enrolment in a U.S. Phase II clinical trial using intravenous administration of REOLYSIN(R) in combination with paclitaxel and carboplatin in patients with metastic melanoma.  Previous trials with melanoma patients using local administration of REOLYSIN(R) in combination with radiation or chemotherapeutic agents, resulted in nearly all the patients exhibiting at least stabilization in their disease. Previous preclinical data has conclusively demonstrated synergism when REOLYISN(R) is given in combination with various chemotherapeutic agents as well as co-treatment with radiation.  It has also demonstrated efficacy as a monotherapy by selectively killing malignant cells while sparing normal ones.  

Since the majority of metastatic cancers have an activated RAS pathway, therapies utilizing REOLYSIN(R) would appear to be logical part of any cancer therapy to halt the major problem when fighting this disease, metastasis.  Preclinical experiments, as well as human clinical trials, have shown reduction or destruction of metastatic cells and tumors by circulating reovirus.  One unique property of REOLYSIN(R) administration compared to currently approved cancer therapies, is the minimal side effects which are similar to a mild virus infection.  To date, no maximum tolerated dose (NYSE:MTD) has been reached.   More compelling is the synergism exhibited by REOLYSIN(R) when combined with a number of chemotherapeutic agents or radiation which have clearly shown significant synergistic therapeutic results for patients with advanced disease, patients for whom there are limited or few options.  To date, ten human clinical trails have been concluded, all with promising results attesting to the ability of this reovirus to infect and lytically destroy cancer cells while avoiding harm to normal cells.  In addition to directly lysing cancer cells, by co-opting these cells to produce progeny virus particles resulting in bursting of the cell’s membrane.  There is some evidence that cellular immunity against the cancer cells may be enhanced or activated, to assist in tumor destruction.

Oncolytics has also validated production of a 100 liter batch of reovirus as well as lyophilization of their product that is being used for current and planned trials.

On September 1, Oncolytics announced it was granted its 32nd U.S. Patent entitled “Viruses for the Treatment of Cellular Proliferative Disorders” which secured previous U.S. patents covering the use of other oncolytic viruses to treat RAS-mediated cancers (such as modified parapoxivirus, adenoviruses and mutated herpes simplex virus).   Thus, it has a strong patent position regarding their product or future products in this area.It is gratifying for long term investors in this company, and more importantly, those on the front line treating ill cancer patients, that have been following their deliberate and focused efforts to produce a therapy, to observe this step in their attempt to seek authorization for sale of their prospective product.  For investors, the increase in share price of their stock, relative to the potential of this unique treatment hopefully represents the beginning of an anticipated increasing valuation as they proceed toward authorization and sale of product.  Although it is possible that Oncolytics will not attain their desired goal for the above planned Phase III trial, in my opinion, it is more likely based on their previously published preclinical data and the results of concluded human clinical trials that they will be successful as stated in my above referenced article.  Obviously if they are, the stock should ultimately reflect this truly unique approach to cancer therapy.  

Within two years, long term investors, like myself, who have been patiently investing and waiting, will most likely know whether REOLYSIN(R) is truly the treatment that it appears it may be. 

What current cancer treatment (agents or drugs) or therapies (or potential treatment or therapy) has shown promising results with the such vast number of cancers in such a synergistic fashion (with radiation and chemo drugs)?  How many other treatments have not reached their maximum tolerated dose (MTD) or had such benign side effects while sparing normal cells? How many agents can overcome resistant cancers with the same drug after treatment with the experimental agent? How many agents or drugs can access all portions of the body to seek out and kill metastatic cells? If a seeking alpha reader knows of a similar or better company selling at the current price of under $4.00/share, please share it with other seeking alpha readers since I believe it would be a bargain.  

The author is has no affiliation with Oncolytics and is LONG on ONCY.