No serious adverse events seen in ANA598 patients

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No serious adverse events seen in ANA598 patients

UPDATE 2-Anadys hep C drug shows early 73 pct response-study* CEO sees partnership talks heating up* Shares fall 15 percent (Adds analyst comment, share move)By Bill BerkrotNEW YORK, Feb 24 (Reuters) -

An experimental hepatitis C treatment being developed by Anadys Pharmaceuticals Inc (ANDS.O) demonstrated impressive early response rates with no serious safety issues, according to preliminary data from a small mid-stage clinical trial.After 12 weeks of dosing, 73 percent of previously untreated patients who received 200 milligrams of Anadys's ANA598 twice daily in combination with standard treatments achieved undetectable levels of the virus. The 12-week results are known as a complete early virological response (cEVR).Anadys shares fell 15 percent after the data were released as investors may have been disappointed by the unexpected similarity of response rates at 12 weeks between the Anadys drug arm and control group of the study.Of the 14 patients who received the standard treatment of pegylated interferon and ribavirin, the cEVR rate was a much higher-than-expected 71 percent."It doesn't look like a

differentiated product on top of standard of care. There was essentially no difference between 598 on top of standard of care and standard of care," said Thinkequity analyst Skorney, calling the control group response "bizarre" and "confounding."There was a much larger separation of response rates between the two treatment arms at weeks 4, 6, 8 and 10, when the ANA598 viral response was already at 73 percent, while the standard of care group response was 54 percent.Anadys said the virtually identical 12-week response rate between the two arms of its Phase II trial may be due to the small number of patients, and were likely skewed by one patient from each group who was unavailable for measurement at week 12 of the study so were not included in the data."I can buy the explanation, but I have to see more data to accept the explanation," Skorney said."If we see a repeat in the next data slice, then it's not compelling,"

he added."We would expect the placebo group number to regress back to more typical historical norms as the numbers of patients became larger both in this trial and in subsequent trials," Anadys Chief Executive Steve Worland said in a telephone interview.Analysts on a conference call with the company appeared to be generally impressed with the ANA598 data.No one in the 26-patient ANA598 arm of the trial experienced viral rebound, or a return of the virus once it appeared to have been knocked out.No serious adverse events were reported with ANA598, and the side effects that were observed, such as a rash, were comparable between the ANA598 patients and those that received the standard treatment plus a placebo, the company said."We're very encouraged. The cEVR number, good safety and lack of rebound are all very positive for 598," Worland said, noting that the response rate was "comparable to the most advanced

protease inhibitors in development."ANA598 belongs to a class of drugs called non-nucleoside inhibitors."There's a fair amount of skepticism that a non-nucleoside that even got a good number early could sustain that number between week 4 and week 12," Worland said."Everybody who experienced benefit from 598, all of that benefit is preserved through week 12," Worland said. "That's contrary to expectations and very positive for combining 558 with direct antivirals."Patients will continue to be treated through 24 or 48 weeks, with the most important data, the sustained virologic response, or SVR rates, becoming available toward the end of the year, the company said.SVR is considered tantamount to a cure for the serious liver disease. The cure rate for the current treatments is typically only between 45 percent and 60 percent.The current standard treatments require 48 weeks of dosing and are difficult to

tolerate with flu-like symptoms often persisting throughout. Patients not helped by those drugs often have no alternative but an eventual liver transplant.Several companies, including Vertex Pharmaceuticals Inc(VRTX.O) and Merck & Co (MRK.N), are developing promising new antiviral medicines that have shown far higher cure rates, often with shorter treatment durations, when combined with standard drugs.The early response rate for ANA598 is comparable to what has been seen for those other promising hepatitis C treatments in clinical trials, while the control group response was far higher than what has been seen in those other studies.Discussions on a partnership deal for ANA598 are now expected to heat up."We're resuming an engaged level of dialogue with companies now that were waiting to see the 12-week data," Worland said.Anadys shares fell to $1.95 in extended trading from their Nasdaq close at $2.31.

(Reporting by Bill Berkrot)

ANA598 - HCVA Non-Nucleoside HCV Polymerase InhibitorANA598 is our non-nucleoside polymerase inhibitor that we are developing for the treatment of chronic hepatitis C virus (HCV) infection. We are currently conducting a Phase II clinical trial of ANA598 in combination with pegylated interferon-alpha and ribavirin (standard of care or SOC) in which ANA598 is being dosed for 12 weeks at two doses levels: 200 mg given twice-daily (bid) and 400 mg given bid. The study is being managed by the Duke Clinical Research Institute (DCRI) under the leadership of McHutchison, M.D. and is being conducted at a number of clinical sites in the United States.ANA598 dosing is complete in the first dose cohort, 200 mg given bid, and Anadys expects to receive 12-week safety and antiviral response data for this cohort in the first quarter of 2010. Enrollment is complete

in the second dose cohort, 400 mg given bid, and Anadys expects to receive 4-week safety and antiviral response at 400 mg bid at the end of the first quarter of 2010 and 12-week safety and antiviral response data in the second quarter of 2010.In December 2009, Anadys reported positive preliminary antiviral response and safety results at week 4 from the first dose cohort (200 mg bid). In the group receiving ANA598 added to SOC, there was a steady increase in the percentage of patients with undetectable levels of virus from week 1 through week 4, with 56% of patients achieving undetectable levels of virus at week 4 (defined as Rapid Virological Response or RVR), compared to 20% of patients receiving placebo plus SOC achieving an RVR. No patient receiving ANA598 experienced viral rebound (defined as an increase in viral load of greater than 1 log10 from a prior measurement) through week 4. ANA598 also demonstrated a favorable safety profile through

four weeks. There were no serious adverse events reported and the profile of adverse events reported was as expected for patients receiving SOC alone, with comparable rates observed between the ANA598 and placebo arms In the ongoing Phase II study, treatment-naïve genotype 1 patients are to receive ANA598 or placebo in combination with Pegasys® (peginterferon alfa-2a) and Copegus® (ribavirin, USP) for 12 weeks at dose levels of 200 mg or 400 mg both given twice daily (bid), each with a loading dose of 800 mg bid on day one. After week 12, patients are to continue receiving SOC alone. Patients who achieve undetectable levels of virus at weeks 4 and 12 will be randomized to stop all treatment at week 24 or 48. The primary endpoint of the study is the proportion of patients who achieve undetectable levels of virus at week 12 (defined as complete Early Virological Response, or cEVR). Additional endpoints include safety and tolerability as well as the

proportion of patients with undetectable levels of virus at week 4 (defined as Rapid Virological Response, or RVR). Patients will be followed for 24 weeks after stopping therapy to determine the rate of Sustained Virological Response, or SVR. Approximately 90 patients are planned to be enrolled in this study - with approximately 30 patients receiving ANA598 and 15 receiving placebo at each dose level.Anadys laid the foundation for the current Phase II clinical trial with prior clinical and preclinical work. In a Phase I trial in HCV patients, ANA598 demonstrated potent antiviral activity when dosed as monotherapy over three days. Anadys has presented in vitro data supporting the use of ANA598 in combination with interferon-alpha as well as with direct antivirals currently in development. Data has shown that ANA598 is synergistic in vitro with interferon-alpha as well as representative HCV protease and polymerase inhibitors. in vitro combination

treatment at clinically relevant concentrations of interferon-alpha and ANA598 results in clearance of HCV RNA from cells rather than selection of resistant isolates. Furthermore, ANA598 retains full activity in vitro against mutations conferring resistance to protease inhibitors, nucleoside polymerase inhibitors and non-nucleoside polymerase inhibitors that act at binding sites distinct from that of ANA598, and protease and nucleoside polymerase inhibitors retain full activity in vitro against mutations conferring resistance to ANA598.

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