December 2, 2011

Trial Design: Patient Population

Before you read further, please understand the basis upon which I write the following blog posts on trial design. I believe Dr. Jen's equity research note essentially telegraphs the trial design for the MM RCT Phase 3 SPA trial. If you disagree, well...

Dr. Jen noted patients eligible for the trial likely would be those with Stage IIIb, Stage IV M1a, and possibly some with Stage IV M1b. Recall I previously posted that he also should have included Stage IIIc together with Stage IIIb and Stage IV M1a, as the company's principal investigators had done in their presentations.

Is past performance indicative of future results? In the investment world, the phrase "past performance is not necessarily indicative of future results" is an often-made statement when presenting historical investment performance. If you believe this, you won't buy Provectus shares! You might even sell your existing shares!

I believe past performance is indicative of future results when applied to the company's clinical results to date and, thus, going forward. It is not a matter of faith, but rather facts. Let us explore those facts in the context of this.

What do I fear? I fear past results can't/won't be repeated, within some acceptable range.

Why do I fear this? If future clinical results aren't as good, the company misses clinical and regulatory milestone payments from the end-game acquirer. Huh? As I've previously blogged, management is reducing the risk for the acquirer by firming up the regulatory path for melanoma and liver. Agreeing on an SPA with the FDA is a box to check. But rose bengal still has to produce! The eventual valuation of the company when the acquisition is negotiated will undoubtedly have milestone payments related to clinical and regulatory events or triggers. Recall from the sub-title of this blog, I'm expecting Provectus to be the greatest trade ever. Wouldn't I look and feel dumb if the MM RCT Phase 3 trial fell flat on its face.

What might we expect to see in terms of clinical results for the Phase 3 trial? Who knows? The following may be heresy to some (yes, I understand patient populations for Yervoy, for example, had more severe patients, etc.), but this analysis is how I form, at a minimum, a boundary or a framework for my expectations. Beyond this, the trial either meets, exceeds or falls below expectations in some way.

Recall the response results by disease stage from the MM Phase 2 trial:

The patient population of the Phase 3 trial might (will) comprise Stage IIIb-Stage IV M1a and possibly some Stage IV M1b patients:
  • 53% CR+PR? Wow! (I haven't weighted the percentages based on patients per response)
  • 77% CR+PR+SD? Double wow! (Ibid)
  • 55% OR for Stages III-IV (M1a)
How did OncoVex and Yervoy stack up? You know who makes Yervoy, and recall that BioVex, OncoVex's producer was acquired for approximately $1 billion:

OncoVex: 37.5-40% CR+PR for Stage III-IV M1a
ipilimumab/Yervoy: 8-15% CR+PR for Stage III-IV M1a

Dig deeper:

OncoVex: 20% CR
DTIC: 2-3% CR
PLX4032-a: 5% CR (BRIM2 trial; yes, 60% of subjects were Stage IV M1c)
PLX4032-b: 0.9% CR (BRIM3 trial; yes, 65% were Stage IV M1c, with 5% Stage III, and most of the
remainder being Stage IV M1b)
ipi+DTIC: 1.6% CR (BRIM3 trial; yes, 65% were Stage IV M1c and 25% Stage IV M1b, with only 3% Stage III)

  • Do you see PV-10's CR above for the target population of the Phase 2 trial?
  • What would you hazard the likely response rates to be for the Phase 3 trial?
  • Do you think the study will be stopped early due to the clear superiority of the PV-10 arm?
  • How will the likely dramatic difference in response influence valuation?
  • What is the likelihood of clinical and regulatory milestones payments being made?

The hallmark of modern science is reproducibility. I know what my answers are to these questions. What are yours?

Note: All lesions would be treated for Provectus' Phase 3 study. In the Phase 2 trial, 1-10 target lesions and up to 1-10 non-target lesions were treated. How would that affect the eventual CR+PR?

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