La Jolla CEO decamps just as biotech faces a reckoning for iron overload drug
Months after touting how LJPC-401 appears to significantly lower excess iron levels in a small study involving patients with hereditary hemochromatosis, La Jolla Pharmaceutical is reconsidering its plans as the drug flopped for beta thalassemia patients. And they’ll be reviewing their future under a new CEO — with a seriously deflated share price.
The San Diego-based biotech is gutting that study, LJ401-BT01, immediately. A recent interim analysis, which included about half of the enrolled population, suggested a lack of efficacy. As far as they could tell, patients on the treatment and control arms saw the same changes in cardiac iron levels, the primary endpoint, and in other iron, hematology and endocrine measurements.
“The Company expects to re-evaluate its current operating plan in light of the mixed results of these studies and to make adjustments as appropriate to manage the Company’s available cash resources,” it said in a statement, prioritizing the sales of its sole marketed product and regulatory activities for a second experimental drug.
CEO George Tidmarsh won’t be around for the soul searching. In a separate announcement, La Jolla disclosed that its chief of seven years has left to pursue other interests.
As board directors Kevin Tang and Craig Johnson step in to oversee the management team, they are tasked with maximizing sales of Giapreza — a vasoconstrictor approved to increase blood pressure in adults with septic or other distributive shock in the US, and to treat refractory hypotension for the same population in Europe — and seek an FDA green light for the malaria therapy LJPC-0118. La Jolla has recently filed an NDA for the drug.
La Jolla still counts $104.8 million in cash as of September 30, compared to $172.6 million at the end of last year. Giapreza has brought in $15.8 million in the first three quarters of 2019, a far cry from its peak sales estimate of $600 million.
LJPC-401 was a key part of the biotech’s pitch for a $100 million public offering in 2018, just after it rolled out Gizpreza. And investigators in the hereditary hemochromatosis trial gushed over it as it promised to be the first new treatment for this disease in more than a decade, saving patients from frequent phlebotomy procedures.
The company said topline results in that trial were consistent with the interim numbers reported in June, in which the drug conferred a statistically significant reduction in transferrin saturation and requirement for phlebotomy procedures compared to placebo.
LJPC-401-treated patients had a mean reduction in TSAT of 33% compared to placebo-treated patients who had a mean reduction of 3% (p<0.0001). […] LJPC-401-treated patients had 0.10 phlebotomies per month compared to placebo-treated patients who had 0.50 phlebotomies per month (p<0.0001).
Investors’ enthusiasm is disappearing almost as swiftly as they shot up. Shares $LJPC were down 53.58% to $2.59 following the news on Monday.