LONDON – Hopes for AstraZeneca's promising cancer drug pipeline were boosted on Friday by news the company had moved its immuno-oncology medicine MEDI-4736 into a mid-stage study in colorectal cancer.
The drug, which is designed to help the immune system fight tumours, will be tested in 48 patients with advanced disease in the Phase II trial, according to an update on the website clinicaltrials.gov.
Analysts at UBS said the decision opened up "a potentially multi-blockbuster opportunity", given that colorectal cancer is the third leading cause of cancer-related deaths in the United States.
AstraZeneca is already studying MEDI-4736 in lung cancer and head and neck cancer. Head of medicines development Briggs Morrison said in July that it might start tests in another tumour type in 2014 but he did not identify colorectal cancer as a target at the time.
Shares in AstraZeneca, which also remain propped up by speculation of a possible renewed bid from Pfizer, rose 2.1 percent to 45.74 pounds by 1000 GMT, outperforming a 0.4 percent gain in the European drugs sector.
Although British-based AstraZeneca fended off a $118 billion takeover attempt by Pfizer in May, the U.S. drugmaker could still decide to return to the fray.
Pfizer Chief Executive Ian Read has made clear he is still considering big deals to revive his firm's pipeline and cut its tax bill - something buying AstraZeneca would allow it to do via a so-called inversion that would shift its tax base to Britain.
Recently, speculation has grown that Read might look at other targets, such as Ireland-based Actavis. But Actavis, which is a major seller of generic drugs, would not be as good a fit strategically as AstraZeneca.
AstraZeneca's pipeline of immune system-boosting cancer drugs would complement Pfizer's currently narrow oncology portfolio - and progress with MEDI-4736 might make it a more attractive target.
MEDI-4736 is part of a closely-watched class of drugs known as anti-PD-L1 therapies, which block a tumour's ability to evade the immune system's defences.
$6.5 BILLION SALES?
MEDI-4736 is seen as AstraZeneca's most important new drug hope and it was one of several experimental products flagged by the company in May in a bid to convince investors the group has a healthy future as an independent company.
Overall, the British company forecasts its new products will help its sales rise 75 percent to $45 billion by 2023 - a number viewed as optimistic by many analysts. Within this, it forecast potential peak sales for MEDI-4736 of $6.5 billion, including use in combination therapies.
UBS, which rates AstraZeneca a "buy", said it currently expected MEDI-4736 could generate peak sales in solid tumours of $1 billion but success in colorectal cancer would likely make this estimate highly conservative.
"If this peak sales figure is raised to $5 billion, for example, then the NPV (net present value) upside could be around 5 pounds per share, without risk-adjustment," it said.
The new open-label Phase II study, which is not yet open for patient recruitment, is being run by the New York-based Memorial Sloan-Kettering Cancer Center in collaboration with AstraZeneca.
AstraZeneca is seen as No. 4 in a race to develop the first drug in a new immuno-oncology class, behind rivals Merck & Co, Roche and Bristol-Myers Squibb, but it still has the capacity to steal a march in certain areas.
Its rivals have yet to initiate dedicated studies in colorectal cancer, although the disease is being explored by competitors as part of studies looking at multiple tumours.
AstraZeneca is due to present more data on MEDI-4736 in lung cancer and head and neck cancer at an oncology conference in Madrid at the end of September.
In recent years, the British drugmaker has become best known for its cholesterol drug Crestor and its ulcer and heartburn pill Nexium. But it has a long history in oncology, having broken new ground decades ago in developing tamoxifen and other hormonal therapies. It also produced one of the first "targeted" cancer drugs, Iressa.