OncoGenex Cancer Drug Fails In Phase III Study, Stock Down

Shares of OncoGenex Pharmaceuticals, Inc. (NASDAQ:OGXI) tanked 10.7% after the company reported disappointing data from the final analysis of the phase III ENSPIRIT study on custirsen for advanced or metastatic non-small cell lung cancer (NSCLC) in patients who have progressed after initial chemotherapy.

Data from the randomized, open-label study showed that the candidate failed to achieve the primary endpoint of a statistically significant improvement in overall survival in patients when treated with custirsen, in combination with docetaxel, compared to docetaxel alone. Moreover, the median overall survival for the custirsen arm was 9.0 months compared to 7.9 months for the control arm. However, safety results were found to be consistent with those observed in the previous studies on custirsen in combination with chemotherapy.

This August, OncoGenex’s shares took a beating after the company reported that custirsen had failed to meet the primary endpoint in a phase III study (AFFINITY) in men with metastatic castrate-resistant prostate cancer (CRPC). Custirsen had even failed to meet the primary endpoint in the phase III SYNERGY study in men with metastatic CRPC. Given the continuous negative study outcomes on the candidate, the company conducted an early final analysis of the ENSPIRIT study in order to conserve resources.

With no approved product in its portfolio and custirsen being one of the few late-stage candidates in its pipeline, the latest development is a huge setback for OncoGenex.

The company expects data on its other candidate, apatorsen, which is currently being evaluated in the phase II Borealis-2 study for the treatment of bladder cancer, by the end of this month.

Zacks Rank & Key Picks

Investors interested in the health care sector may consider stocks like Amarin Corporation plc (NASDAQ:AMRN) , BioMarin Pharmaceutical Inc. (NASDAQ:BMRN) and Exelixis, Inc. (NASDAQ:EXEL) . While Amarin sport a Zacks Rank #1 (Strong Buy), BioMarin and Exelixis carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Amarin’s loss estimates have narrowed from 53 cents to 40 cents for 2016 and from 36 cents to 27 cents for 2017 over the last 60 days. The company’s share price has soared 65.1% year to date.

BioMarin’s loss estimates narrowed from 28 cents to 27 cents for 2016 and from $1.16 to $1.12 for 2017 over the last 60 days.

Exelixis’ loss estimates narrowed from 76 cents to 63 cents for 2016 and from 22 cents to 3 cents for 2017 over the last 60 days. The company has posted a positive earnings surprise twice in the four trailing quarters with an average beat of 9.1%. Its share price has surged 117.3% year to date.

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