Last summer Zafgen $ZFGN experienced one of the worst biotech disasters the industry witnessed for all of last year — the kind of nightmare that CEOs dread. After the FDA put their lead drug beloranib on clinical hold in late 2015 — linking it to the death of a patient from a pulmonary embolism linked with the therapy — the biotech had little choice but to kill the program in July and slash its staff after regulators spelled out what they would have to do to qualify for a marketing OK.
But with its share price decimated, Zafgen still didn’t throw in the towel. And now in an effort to make a comeback, Zafgen’s team has released Phase I data that shows its sole clinical drug hope, ZGN-1061, a followup MetAP2 drug, was able to knock about a pound a week off of obese and overweight patients for four weeks, without any signs of thrombotic risk.
Zafgen shares surged 15% on the news Thursday evening, in post-market trading.
Breaking down the data, patients treated with ZGN-1061 for four weeks lost significantly more weight relative to placebo-treated patients, dropping 4.6 lbs, 2.2 lbs and 3.8 lbs for 0.2 mg, 0.6 mg, and 1.8 mg doses, respectively, compared to a 0.51 lb loss for the placebo arm. And that’s what they were hoping to see as they position themselves for a run at obesity and Type 2 diabetes, two of the most difficult mass market conditions any biotech ever tackled.
That’s not the kind of sudden and massive weight loss that beloranib could trigger in the first few weeks, CEO Tom Hughes concedes, but cumulatively it’s significantly better than the disappointing trio of weight drugs that hit a few years ago. This drug, he emphasized, is on the right track for a Phase I, blessedly free of any surprises for the researchers involved.
“We’ve been working in this area for quite some time,” Hughes told me earlier Thursday. That gives the team at Zafgen a chance to carefully evaluate the pharmacokinetic qualities of ZGN-1061, target engagement and the dose effect, confirming the “good behavior” of the drug in an admittedly small number of subjects.
Hughes was definitely upbeat about the results, but also perhaps a little more subdued than in past discussions about beloranib as that drug headed through the clinic before imploding in Phase III.
“I don’t know if you can tell by our tone,” he said at one point, “but we are really, really pleased with the result….It’s good to have a well-behaved molecule.”
Phase I is a relatively small step in the obesity/diabetes R&D world, with major demands that ultimately have to be met on safety and efficacy that have bedeviled other developers over the years and forced investors to direct their cash elsewhere.
Phase II, slated to get underway later this year, will recruit about 120 patients with Type 2 diabetes, says CMO Dennis Kim, probably looking at hemoglobin A1c levels — a classic measure of efficacy — as the primary endpoint. The company still probably hasn’t established the lowest most effective dose of the drug, which they should be able to shine a light on as mid-stage data comes through.
Later on, adds Hughes, it’s possible that Zafgen could take on a partner as it angles for a Phase III. And certainly only a major player could expect to market a drug like this if it eventually wins an OK. But if things continue to go the biotech’s way this time, Hughes feels that the capital will be there for what’s needed.
Now it’s time to concentrate on step 2 in their rehab program.
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