QuickView: Aveo Pharmaceuticals

Aveo has revealed final overall survival (OS) Phase III data for tivozanib in renal cell carcinoma (RCC), which shows a median OS of 28.8 months for tivozanib, versus a median OS of 29.3 months with sorafenib in the control arm (p=0.105, HR=1.25). The OS trend in favour of the sorafenib arm is a clear concern with regard to tivozanib’s approvability by the FDA (PDUFA 28 July 2013), but the trial design may provide the mitigating circumstances to persuade the regulator that tivozanib has a role to play in RCC. A planned FDA advisory committee review of tivozanib in the coming months will serve as a major catalyst for the stock.

Final OS data a concern...
A concerning OS trend from the TIVO-1 study was flagged in August 2012, so the final OS data in favour of sorafenib is not surprising. OS was a secondary end point in the trial, which hit its primary target of a significant progression-free survival (PFS) benefit for tivozanib (11.9 months) vs sorafenib (9.1 months), as a first-line therapy. Four tyrosine kinase inhibitors (TKI) – sunitinib, sorafenib, pazopanib and axitinib – have gained FDA approval on a PFS benefit, although all also showed a favourable OS trend.

...but a discrepancy in secondary therapies offers explanation
The key confounding factor, which might explain the OS result is that patients failing to respond to sorafenib were allowed to cross over to tivozanib. Sixty-nine percent did so, but tivozanib patients were only offered standard alternatives. However, few alternatives exist in Central/Eastern Europe, where most were recruited; 64% of tivozanib patients received no further therapy. The bias in favour of sorafenib was a trial design flaw, but given the strong OS data on tivozanib alone (OS data for sunitinib, pazopanib and axitinib [second line] is 26.4, 22.9 and 20.1 months, respectively), the drug cannot be discounted yet; the data also suggests a second-line benefit for tivozanib in sorafenib failures.

Subgroup analyses to build the defence
Aveo will present full details of the TIVO-1 study at the 2013 Genitourinary Cancers Symposium (ASCO GU) on February 16, including a number of subgroup analyses (included in the NDA, accepted November 2012) to bolster the secondary therapy thesis. For example, 40 patients of 517 recruited in North America and Western Europe (with more second options), showed an OS trend in favour of tivozanib.

Valuation: $190m EV still offers plenty of up and downside
Cash of $214m stretches to Q214, reflecting significant investment in a 50/50 cost/profit-sharing deal with Astellas, and further trials in colon and breast cancer. The FDA AdCom is a major catalyst that may attract risk-tolerant investors.

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