Ontak received FDA Advisory Panel backing. The stock (SRGN) over-reacted, to 0.80, before falling back to 0.62, or so. Based on the LGND deal, SRGN is worth around 0.70, IMO (without even factoring in LGND's substantial discount to fair value, and discounting the 0.23 payment by 10% for the one year, or so, time lag.)
Seragen Wins FDA Panel Backing for Ontak Cancer Drug (Update1)
Bloomberg News
June 2, 1998, 9:32 a.m. PT
Seragen Wins FDA Panel Backing for Ontak Cancer Drug (Update1)
(Adds panel action)
Gaithersburg, Maryland, June 2 (Bloomberg) -- Seragen Inc.'s
Ontak drug won the backing of an expert government panel for
fighting a rare cancer in patients who otherwise would have few
options for battling the disease.
In two unanimous votes, the U.S. Food and Drug
Administration advisory panel decided the drug is safe and
effective and should be cleared for sale to treat patients with
an unusual cancer known as cutaneous T-cell lymphoma.
The drug is ''truly a miracle,'' said William Smith, a
patient from Hingham, Massachusetts.
Hopkinton, Massachusetts-based Seragen originally developed
the drug with Eli Lilly & Co. Last month, however, Ligand
Pharmaceuticals Inc. said it planned to buy Seragen and to
acquire Lilly's rights to Ontak.
Seragen shares were unchanged at 54 cents in recent trading,
while shares of San Diego-based Ligand fell 7/16 to 13 5/16.
The panel is still deciding what further studies will be
needed to determine how the drug best can be used and at what
dosages.
Cutaneous T-cell lymphoma is a very rare and ultimately
fatal condition. Still, it's slow growing, and most patients live
at least 10 years after diagnosis.
Cancer experts today presented studies that showed about 30
percent of the 71 patients who got the drug had at least a
partial response in which the disease and symptoms improved. All
evidence of the disease disappeared in 10 percent of the
patients, the studies showed.
Side Effects
Most patients had side effects ranging from infection to
fever and chills. A significant number of patients also had
cardiovascular problems after getting the drug. The company said
it was difficult to assess which of the side effects were solely
due to the drug, and not from the disease itself.
In addition to improving a patient's health, the drug
improved symptoms of the disease, very important in this
particular cancer, experts said today.
''All except a few relapsing patients showed improvement
(and) had a significant improvement in their quality of life,''
after being treated with the drug, said Madeleine Duvic, a cancer
doctor from the M.D. Anderson Cancer Center, who participated in
the company's study and presented data on the drug's
effectiveness.
The T-cell lymphomas begin as small plaques of tough, scaly
patches and gradually spread over the skin. The brownish-black
plaques -- which can grow to cover the majority of a patient's
face and body -- are disfiguring, itch and are prone to
infection. If left untreated, the topical cancer will develop
into tumors, and finally seep into the organ systems and spread
throughout the body.
Experts today showed slides of patients whose faces and
bodies had been obscured by the disease and told of one woman who
said her daughter had been afraid of her until the drug shrank
and healed the facial plaques.
While the disease is slow moving, it accelerates in advanced
forms and those who are diagnosed after the lymphoma has reached
their organs generally live less than two years. The company is
asking for clearance to sell the drug to treat patients who have
more advanced disease and who have already failed other
treatments.
Currently, some patients have their bodies coated with toxic
mustard treatments, have either their skin or their blood
radiated, or undergo harsh chemotherapy regimens. These
treatments are time consuming, and are extremely toxic to the
skin, leading to lesions, further scarring and even other forms
of skin cancers.
Ontak is a form of a natural immune system compound called
Interleukin-2 which is merged with the toxin from diphtheria. It
is produced by genetically engineered e.coli bacteria. The
company said it is still in studies to determine just what doses
work best in patients.
Later this morning the panel will hear the FDA's
interpretation of the data, and then make a recommendation. This
afternoon, the cancer advisory committee with consider whether to
recommend SmithKline-Beecham's Hycamtin drug for patients with
lung cancer.
--Kristin Reed in Gaithersburg, Maryland with reporting from
More News: LGND |
