FDA revives Oxigene's thyroid cancer drug hopes, shares surge
(Reuters) – Oxigene Inc said U.S. health regulators indicated that its experimental thyroid cancer drug may warrant further development, cheering investors a month after the company stopped enrollment in a drug trial.
Oxigene shares jumped 41 percent in morning trade on Monday, after the company said the U.S. Food and Drug Administration (FDA) found that data from a mid/late-stage trial for the drug, Zybrestat, was suggestive of possible clinical activity.
Last month, the company had cut about half of its workforce to cut costs and focus on key assets. It also planned to stop enrollment in the mid/late-stage trial for the drug.
"With this important FDA visibility ... Oxigene must now clearly define its path forward from a funding standpoint either by delivering a major partnership or by giving investors the confidence that they can fund the way forward," Roth Capital Partners analyst Joseph Pantginis said.
The company said it is reviewing its options for further development of the drug and the additional funding needed through strategic partnerships and equity financing.
Oxigene will have to do a new trial to seek regulatory approval for Zybrestat, the FDA had said in a March 16 meeting.
Also the trial protocol agreement decided upon at the start of the study is no longer valid, Oxigene said in a statement.
The special protocol agreement provides a company with a written agreement that the design and analysis of a trial are adequate to support a marketing application submission with the regulator.
Another small-cap company developing a thyroid cancer drug is Exelixis Inc, while AstraZeneca is also trying to get its new thyroid cancer pill approved by the U.S. regulator.
Oxigene shares were up 29 percent at $2.34 in late morning trade. They reached a high of $2.57 earlier in the session, making them one of the top gainers on Nasdaq on Monday.
(Reporting by Esha Dey in Bangalore; Editing by Gopakumar Warrier)