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Biotech Stock Review: CytRx Corporation (CYTR)

27 May 2011 5 Comments

With a former investment banker heading the company, it is not entirely surprising that CytRx had ended up with an eclectic portfolio ranging from RNAi to molecular chaperones to kinase inhibitors. CEO Steven Kriegsman simply cannot let a good deal pass him by. Still, I believe it is to the company’s benefit now that CytRx has sold or spun off the remainder of its legacy assets, focusing on its three core cancer projects.

CytRx’s pipeline consists of three compounds; Bafetinib, a dual Bcr-Abl/Lyn kinase inhibitor; Tamibarotene, a synthetic retinoid; and INNO-206, a tumor targeted doxorubicin conjugate. All three will be in Phase II or later by the end of this year. Tamibarotene is the most advanced clinical candidate and is in pivotal trials for Acute Promyelocytic Leukemia (APL), a subtype of Acute myeloid leukemia (AML).

Tamibarotene for APS is not a significant market – the key is non-small-cell lung cancer (NSCLC). Tamibarotene acts in a very similar way to all-trans retinoic acid (ATRA). This drug in combination with arsenic trioxide is a very effective treatment for APL due to mutations in the retinoic acid receptor gene. ATRA induces malignant cells to terminally differentiate then undergo apoptosis. The drawback of ATRA therapy is a side effect known as retinoic acid syndrome, a potentially life-threatening condition that requires stopping of medication.

Tamibarotene, while being ten times more potent than ATRA in assays of cell differentiation has shown much lower levels of retinoic acid syndrome. In Japanese clinical trials, the drug demonstrated its ability to induce complete responses in 60% of APL patients who failed ATRA, quite extraordinary. Tamibarotene may also achieve a complete response faster than traditional ATRA treatment. The data bodes well for a positive pivotal APL trial.

But that is not their ultimate goal. A Phase II study has shown ATRA to be extremely effective in first line NSCLC. In a randomized trial of patients with Grade 3-4 NSCLC, patients were either treated with paclitaxel plus cisplatin or ATRA, paclitaxel, plus cisplatin. Median survival increased in the ATRA group to 23.5 months from 9.6 months. Steven Kriegsman, the company’s CEO, believes their drug has the potential to show a similar survival advantage with a better side-effect profile.

Tamibarotene is now in a Phase II trial enrolling 140 patients with or without paclitaxel and cisplatin in Grade 3-4 NSCLC patients. After 70 patients have been enrolled, an interim analysis will be performed to determine futility.

Another retinoid had previously been tested in NSCLC and failed. The company believes the compound failed because it selectively bound RXR receptors while binding of both RXR and RAR receptors are required for activity. Tamibarotene and ATRA bind both.

Now for the company’s kinase inhibitor Bafetinib- already in Phase II, this compound is being tested both for blood cancers and solid tumors. Interim data from a Phase II study in B-cell CLL will be available by June this year.

A feature that sets Bafetinib apart from most other cancer drugs is its ability to restore bone loss. According to David, it is as effective as Novartis’ blockbuster Zometa at preventing cancer related bone loss in preclinical models. The mechanism of action may be similar to that of Amgen’s Denosumab, operating through inhibition of RANKL, which has been implicated in bone loss.

INNO-206 is part of the company’s platform technology. The molecule itself consists of the chemotherapy doxorubicin conjugated via a pH sensitive linker to an albumin binding moiety. Upon entering the bloodstream, INNO-206 rapidly binds to the albumin protein. It is not released until it reaches the acidic conditions found within tumors, preventing damage to normal tissue.

Doxorubicin is a very effective therapy but limited by cardiac toxicity. With this technology, CytRx is able to use a dose four times higher than previously possible. The compound is in an accelerated Phase I study that will quickly move into a Phase II study comparing INNO-206 directly with doxorubicin. Doxorubicin forms the backbone of a multitude of treatment regimens; a drug with its efficacy but lower toxicity may be very successful.

As with any good platform technology, CytRx is applying its albumin targeting technology toward other chemotherapies. It’s possible that there may be many drugs amenable to this type of targeting. Some are now in pre-clinical studies.

A full pipeline and sound finances; the company has about $30 million in cash with an annual burn rate of just $15 million. Importantly, CytRx holds rights to most major markets for all three of its compounds and linker technology.

Disclosure

This is part of a paid, but independent Research Series on CytRx. The views and opinions expressed in this Series are purely my own. I have no positions in CytRx, and no plans to initiate any positions within the next 72 hours. Rule 17B requires disclosure of payment for investor relations services. 20smoney.com has been compensated $200 by a third party on 5/27/2011 for an independent review advertisement for CytRx. For complete disclosure/disclaimer statement, please review the Disclosure Statement relevant to this Series. [Link to Disclosure Policy].

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5 Comments »

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