MEI Pharma Inc. (NASDAQ:MEIP)
On Monday, MEI pharma released results of its phase 2 clinical trial in elderly patients with Acute Myeloid Leukemia - AML. These results were presented at a prestigious medical conference known as the American Society of Hematology or ASH. The results themselves were outstanding, but the stock didn't budge at all. Matter of fact, the MEIP stock only closed higher by 1.27%. The problem is that the data was sufficient enough to carry the stock higher by at least 20% or more. Typically, when a biotech in phase 2 releases positive clinical results, the stock should rise by at least 20% or more. On the other hand a trial that fails can fall by as much as 50% or more, on average. There is no denying that the stock should have traded higher, but this can be attributed to a few reasons. One reason being that the company will now have to run a large phase 3 trial in the same elderly population. That means the company will need to eventually raise additional capital. In addition, the success rate for AML drugs in phase 3 clinical development is really low. These two reasons are probably why the stock traded close to flat on Monday. It is highly possible that the stock could trade higher in the coming weeks if big positions were to pour in.
Phase 2 Results
This phase 2 study used the drug Pracinostat to treat these elderly patients with AML. The study was open-label in nature and recruited a total of 50 patients. The open-label nature of the trial let researchers and management know whether the patients received the drug or not. Patients were given 60mg of Pracinostat orally three times a week for a total of three weeks. Then patients were given a chance to rest away from treatment, and then followed up with a subcutaneous injection or intravenous infusion of azacitidine for the first 7 days of each 28-day cycle. The treatment was safe but there were some grade 3 to grade 4 adverse events. The thing to note is that the adverse events weren't anything in which the patient could die from. The study results were nothing short of amazing. The median overall survival was 19.1 months, which is much better than azacitidine alone. The one year survival rate was 62% and the complete response rate was 42%. One of the investigators of the trial, Dr. Garcia-Manero, had this to say:
"The results from this study of Pracinostat and azacitidine in elderly patients deemded unfit for intensive therapy are particularly encouraging. Despite recent advances in the treatment of AML, options for these elderly unfit patients remains unlimited. The combination of Pracinostat and azacitidine appears to show a long-term survival benefit in this population, including an unprecedented two-year survival rate of 41% in this study"
These results are highly notable, especially in a population that can't take many other forms of treatment because of how frail their bodies are. Remember, these are patients that are at a median age of 75. Having to take chemotherapy or other invasive forms of treatments is not ideal at all.
The phase 2 results are highly encouraging, so much so that MEIP is already recruiting for a phase 3 trial of newly diagnosed elderly patients that are 75 and older. The stock didn't react appropriately as expected, but the truth is that the long-term story remains intact. Over time new investors will find out the true value of the company, especially once the phase 3 trial enrollment nears completion. For now, investors will have to continue to believe that the data observed to date warrants continuing to hold their investment. Sometimes biotechnology stocks don't move up until a few days or a few weeks after results. This is because some results may take time to interpret the data. MEIP should be in good standing considering that it has a good pipeline of cancer drugs. In addition, to date, the company has shown that its drug continues to work in this hard-to-treat patient population.
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