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'Not Happy' with Progress of Calando Phase I Solid Tumor Rx, Arrowhead Adding Third Clinical Site

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By Doug Macron

Admitting that it is "not happy" with the progress of its subsidiary's phase I study of an siRNA-based cancer drug, Arrowhead Research said last week that it is preparing to add a third clinical site to the trial to accelerate patient enrollment.

The company added that the move will enable the unit, Calando Pharmaceuticals, to remain on track to complete the trial by the end of the year.

Arrowhead also reported its financial results for its fiscal first quarter, posting sharply increased revenues and narrowed losses courtesy of a deal for non-RNAi technology under development by another Arrowhead subsidiary.

Calando's drug CALAA-01, its sole candidate, comprises siRNAs against the M2 subunit of ribonucleotide reductase delivered via its proprietary Rondel cyclodextrin-based polymer technology. The drug became the first formulated RNAi therapeutic to enter human testing in 2008.

Since that time, however, Calando has made limited progress in the trial.

While the data are thus far promising, Arrowhead CEO Christopher Anzalone said during a conference call to discuss the firm's financial results that he is “not happy with how quickly [the study] is progressing.” He declined to say how many patients are currently enrolled in the study, but noted that “we would always like these things to move more quickly than they are, and that's the case here.”

To “maximize the rate at which we are able to treat new patients and accelerate the trial, we plan to add a third clinical site,” he said. “This process is underway, and we believe we will have [the new] site running over the next couple of months.”

He added that with complete phase I data, Calando should be in a good position to finally achieve its longstanding goal of partnering CALAA-01 with a bigger industry player.

“Partnering requirements for RNAi have changed to more closely align with how big pharma has historically evaluated other therapeutic classes,” he said during the call. “Many companies now seem more inclined to pay more for a de-risked therapeutic platform with proven clinical results than to save money by partnering or acquiring newer technology with less clinical data.

We think that every new patient we dose increases the value of this platform and decreases the potential risk to a partner,” he added.

Calando, as well as a number of other companies in the RNAi drugs space, have had their sights set on partnerships for years. But, like those other firms, it has failed to secure one. Late last year, Arrowhead conceded that it would not ink a deal before year end as big pharmas waited to see how its drug would perform in the clinic (GSN 1/6/2011).

Late week, Anzalone painted a promising picture of how CALAA-01 was performing in the clinic, noting that the drug and the Rondel platform appear to be “extraordinarily" well tolerated.

“The fact that this continues to run is somewhat reflective of the safety profile we've seen with the compound,” he said. “If we were seeing a lot of toxicities and such, this trial would have ended by now, but the fact is we're not. It's a well-tolerated drug so far … and we are looking to enroll more patients and further increase the doses to find that maximum tolerated dose.”

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He also declined to provide any new clinical data, instead pointing to a publication last year in Nature showing that CALAA-01, when systemically delivered to patients in the ongoing phase I study, could knock down its intended target mRNA and protein inside a tumor through an RNA interference mechanism (GSN 3/25/2010).

The trial is enrolling patients with solid cancers refractory to standard-of-care therapies. They are treated with one of three doses of CALAA-01 on days 1, 3, 8, and 10 of a 21-day cycle by 30-minute intravenous infusion.

According to clinicaltrials.gov, the National Institutes of Health's clearinghouse for clinical study information, the study is being conducted at the UCLA Jonsson Comprehensive Cancer Center and South Texas Accelerated Research Therapeutics, and is expected to enroll 36 patients.

“We are diligently working to complete our phase I trial, which we believe is a clear value point,” Anzalone said. “While the RNAi landscape may have shifted, the … power of this new class of therapeutics and the great limiting factor of its adoption — effective systemic delivery — have not. Therefore, we remain extraordinarily bullish on Calando's potential value.”

Fiscal First Quarter

For the three-month period ended Dec. 31, 2010, Arrowhead's net loss declined to $1.4 million, or $0.02 per share, from $1.5 million, or $0.03 per share, in the same period a year earlier.

Operating expenses in the fiscal first quarter jumped to $6 million from $2.3 million compared with the year prior, primarily due to license fee expenses. Research and development spending surged to $3.5 million from $277,788.

Revenues in the quarter rose to $5 million from $148,000 last year and included $4.5 million from three deals signed by Samsung Electronics and Arrowhead's one-time subsidiary Unidym, a carbon nanotube maker that was recently acquired by a Korean firm called Wisepower for up to $145 million in upfront and milestone payments.

At the end of 2010, Arrowhead had approximately $5.5 million in cash. Anzalone said during the conference call that the firm currently has “sufficient resources to fund our operations for well over a year.”


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