Biotech Values

[iwfal]

XOMA - cc summary

1) they made it clear that they do not know exactly how mature the second (US only) Behcets trial has to be at time of submittal. E.g. Could be that at some point after submission of a Behcets NDA from the first trial they would submit interim data from the second trial.

2) the second Behcets trial is randomized discontinuation trial.

3) they explained protocol issues that are the reason that they have not yet hit their Behcets trigger number of events despite it being 3 months since the original prediction of hitting the events. Essentially it turns out I was partially correct in a concern I've stated earlier - that the physicians DO have discretion in how they ramp down corticosteroids. Essentially the MDs can stop the ramp down at any time if they are concerned about a Behcets flare of some sort. Even if that flare isn't big enough to be considered an event by the endpoint definition. That patient is then censored at that point in time. Obviously some of those events are not uveitis events, but, from the conversation, some clearly are uveitis events. I.e. The FDA guidance on endpoints is not in sync with medical practice. And the reason they haven't hit their trigger even now, 3 months after the originally predicted end date, is that they have started the cleanup and had to censor some of the exacerbation as not really exacerbation by the criteria of the trial (e.g. The physicians were felt obligated to report an exacerbation to up the corticosteroid dose).

My commentary is:

A) generally I wouldn't expect this to harm them, other than delay, UNLESS the Gev patients have quicker exacerbations. I have no reason to believe this is so - but it is a risk.

B) they clearly need to hire someone (e.g. a consultant like Master) with a lot of diverse clinical design experience. These are newbie mistakes that are easily predictable by someone who has watched a lot of trials and how they fail. They are learning - but unless you work in a really big biotech you'll never get the diversity of experience necessary to predict these things.

C) I would expect that even if #A above is true that and it tanks the primary endpoint I'd still expect the FDA to approve if the censored uveitis flares are heavily skewed towards placebo and the discontinuation trials is trending strongly the same way. (Because it is an orphan disease). But it will slow the submission (e.g. More discussion with FDA or waiting for the other trial to mature.)

4) they are running out of cash. One year left. They do not seem to have picked up an understanding of the biotech law 'get cash while you can (don't gamble on the next trial)'.

Random other commentary by me. They are are starting to talk more about their XMet programs. Particularly XMet D, an allosteric inhibitor of the insulin receptor for people with, for instance, insulinomas - since that is in the lead. Worked well in mice with implanted steady release insulin devices. Humans? (BTW - one of their other two XMet drugs is, essentially/effectively, a very long lasting basal insulin. Meh? That said it may have an advantage vs basal insulin in side effects since it acts differently inre IGF-1 and intercellular actions (ala Trevena)). But the other (XMetS) is a true gain enhancer for normal insulin. Given that the sine qua non of T2D is believed to be insulin insensitivity (I.e. Loss of gain) this has the potential to be truly disease modifying. Also note that of some interest is it doesn't trigger IGF-1 (thought by some be the path by which insulin analogues cause detrimental side effects).