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Talon Therapeutics poised to become a big pharma

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April 28, 2011 – Comments (0) | RELATED TICKERS: PFE , MRK , JNJ

This Non rate-able $1.50 biotech stock has a High Chance of FDA Approval in 2011

Read this in depth article to find out more: 

Talon Therapeutics poised to become a big pharma

Thursday, April 28, 2011

Shares of Talon Therapeutics were clearly chased yesterday and the price has doubled in one month. However, I believe the real potential is yet to come through the many milestones and events about to occur. Firstly, Talon is on its way to submit a complete NDA for Marqibo and potentially receiving approval before the end of this year. Secondly, there is potential for a deal with a large Pharma for Menadione and certainly upfront payment to carry on the clinical development.

Talon Therapeutics is a bio-pharmaceutical company. It is engaged in developing and commercializing cancer therapies designed to enable current standards of care. Its two lead product candidates target large markets. The Company is developing Marqibo for the treatment of acute Lymphoblastic leukemia and other blood cancers, including lymphoma. Menadione topical lotion is a first-in-class compound that the Company is developing for the prevention and/or treatment of skin toxicity associated with epidermal growth factor receptor inhibitors.

Talon Therapeutics is seeking accelerated approval based on data from a Phase 2 RALLY study where it was demonstrated a 35% overall response rate using single agent Marqibo as third, fourth, fifth or sixth line treatment.
Dr. Deitcher stated that “This is the most heavily pretreated and advanced Acute Lymphoblastic Leukemia (ALL) population that has ever been described or studied in the literature.”

Dr. Deitcher, a hematologist and oncologist calls a 35% response rate in this population “very impressive”, adding that about 20% of the patients in the trial achieved a complete response, meaning “elimination of all blood, bone marrow and radiography evidence of their disease, along with a very meaningful median survival.”

Dr. Deitcher points out that the best that has ever been reported with a single agent therapy in a similar or even in a less heavily pretreated population was a 4% complete response rate. “So, what we’ve done with single agent Marqibo, we think, will offer a transformational opportunity for this very sick population of adult patients and a means of bridging to getting a stem cell transplant which could be curative.”

People with adult ALL have a poor prognosis, with a five-year survival rate of about 7%. Third-line therapies induce few responses and are highly toxic, because patients already have been heavily pretreated with up to eight different drugs during first and second therapy. And fourth-line or greater therapy is expected to induce no response, he adds.

“We believe people with ALL, like the population studied in RALLY, represents a very appropriate unmet medical need and an untapped commercial opportunity to bring our drug out into the field,” says Dr. Deitcher.

 

About Acute lymphoblastic leukemias (ALL):

Acute lymphoblastic leukemias is a form of leukemia, or cancer of the white blood cells characterized by excess lymphoblasts.

Malignant, immature white blood cells continuously multiply and are overproduced in the bone marrow. ALL causes damage and death by crowding out normal cells in the bone marrow, and by spreading (infiltrating) to other organs. ALL is most common in childhood with a peak incidence at 2–5 years of age, and another peak in old age. The overall cure rate in children is about 80%, and about 45%-60% of adults have long-term disease-free survival.

Acute refers to the relatively short time course of the disease (being fatal in as little as a few weeks if left untreated) to differentiate it from the very different disease of Chronic Lymphocytic Leukemia which has a potential time course of many years. It is interchangeably referred to as Lymphocytic or Lymphoblastic. This refers to the cells that are involved, which if they were normal would be referred to as lymphocytes but are seen in this disease in a relatively immature (also termed ‘blast’) state.

 

Marqibo NDA submission and request for priority review expected before end of June:

If Marqibo is cleared by the FDA for use in additional, larger indications, Talon is looking at a multibillion-dollar potential. “The path we elected to follow was to provide a better vincristine,” Dr. Deitcher says. “This way, we will be able to provide a turbo charged version of vincristine to physicians who are already comfortable using the drug in their patients. Our way is designed to give them more bang for the dose.”

In the Phase 2 trial, the median age of patients was 32. “These are mostly young people with families, and there’s a lot of value in trying to save those lives,” Dr. Deitcher says.

In addition to statistical measures in the Phase 2 data, the trial produced meaningful patient outcomes. Among other things, 11 patients received stem cell transplants after being treated with Marqibo, and five patients had an overall survival of greater than one year. “The fact that we were able to clear all evidence of leukemia from the blood in 63% of patients after just one dose of Marqibo, and the fact that we had excellent response rates even in those patients who had their solid organs infiltrated with leukemia just shows that this is a very effective and very active agent in this population and it benefits patients,”.

 

What is the true potential market value for Marqibo?

Multi-billion $ worldwide market potential for Marqibo.

Marqibo’s initial indication of relapsed and refractory adult ALL has an annual incidence of 3,200 cases in the U.S. and Europe. But Dr. Deitcher says Talon has a strategy to add indications in much larger disease categories, including front-line ALL, where the incidence is 9,200 cases a year, and front-line non-Hodgkin’s lymphoma, where the incidence is about 132,000 cases a year. These two markets currently represent worldwide sales of about $4 billion.

Talon believes it could initially commercialize Marqibo in the U.S. for this orphan indication with a sales staff of around 10 people, because it already has strong relationships with most of the adult ALL physicians in the U.S., since most of them were part of the earlier clinical studies.

Outside the U.S., the company’s preference is to partner Marqibo. “One of the advantages of not being strapped for financial resources is that we have no need to take a deal now when we know that, even months from now, the value of the deal would be greater,” Dr. Deitcher says. “So the deal with Warburg Pincus and Deerfield has allowed us to wait for the best deal.”

 

Financing:

Marqibo’s Phase 2 data and its commercial potential played a large role in Warburg Pincus and Deerfield Management, an existing shareholder of Talon, agreeing to inject up to $100 million to purchase Talon convertible preferred shares in three tranches. The first tranche of $40 million closed last June, with Warburg Pincus having 90% of it. The preferred shareholders also have an option to purchase up to another $20 million in preferred shares prior to the FDA decision on Marqibo, and if Marqibo receives approval, they have another option to purchase up to a further $40 million.

He says the investment by Warburg Pincus was a “tremendous external validation, not only of Marqibo, but also of the people and the team behind it. The financial commitments are exactly what we needed to be focused on reaching the ultimate goal of getting our drug approved.”

 

Pipeline:

Talon Therapeutics has an impressive pipeline with great potential in Oncology.

Marqibo® (vincristine sulfate liposomes injection, OPTISOME™)
A Novel Targeted Nanoparticle-encapsulated Anti-Cancer Compound currently for Acute Lymphoblastic Leukemia (ALL) and Melanoma. Marqibo® has a robust safety database (over 600 patients) and has been extensively evaluated in lymphoid blood cancers such as non-Hodgkin’s lymphoma (NHL) and ALL. Hana has ongoing (or planned) clinical trials which may enable an accelerated approval in 2 indications. Future clinical trial development possible in multiple indications including NHL and melanoma.

Alocrest™ (vinorelbine liposomes injection, OPTISOME™)
A Novel Targeted Anti-Cancer Compound for Breast and Lung Cancer. Alocrest™ has completed a Phase I dose-escalation trial demonstrating promising anti-cancer activity as well as acceptable and predictable toxicity.

Brakiva™ (topotecan liposomes injection, OPTISOME™)
A Novel Targeted Anti-Cancer Compound for Small-Cell Lung Cancer and Ovarian Cancer. Preclinical data demonstrate the value of Brakiva™ over conventional topotecan.

Menadione Topical Lotion – A Topical Compound for Skin Rash Associated with EGFR Inhibitors. Treatment with EGFR inhibitors such as Tarceva®, Erbitux® and Vectibix® are associated with an acne-form rash involving the face, neck and upper torso in approximately 75% patients. 50% of patients who manifest skin toxicity experience significant discomfort. This results in drug discontinuation or dose reduction in at least 10% and up to 30% of all subjects. Drug delivery is targeted to the normal location of the EGFR-containing skin cells at the dermal/epidermal junction without interfering with EGFR inhibition systemically at the level of the tumor.

 

More details on Menadione:

Besides planning for the Phase 2 program, Talon is also actively in talks to partner Menadione in order to move development forward as quickly as possible, Dr. Deitcher says.

When asked if a collaboration would likely involve one of the companies whose drug causes the rash, he replied, “We have had and are in discussions with companies that have vested interests in the drugs that cause the rash as well as companies who don’t.”

 

Conclusion:

Talon Therapeutics has everything to become a big pharma following the path of big names like HGSI, DNDN or more recently AMRN. A billion dollar market cap is totally feasible and makes sense when you take into account that Marqibo should bring over $100M in yearly earnings quite quickly. In the mean time, Talon will be progressing towards additional Phase III studies for bigger  market applications like Front-line elderly aggressive NHL and Front-line elderly Ph(-)ALL which represents a $5B market.

 

Author of this article is long TLON

 

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