Onyx News Slaps Adherents

Patients in this study had their tumors scanned by doctors every 12 weeks. This is a relatively wide time interval; in many studies, tumors are scanned every four to six weeks. More frequent scans produce more accurate data and reduce the risk that results are overestimated. (A problem with "assessment bias" of time-to-progression data helped trip up Genta and its cancer drug Genasense earlier this year.)

BAY 43-9006 may indeed slow or stop the growth of kidney cancer tumors and hopefully boost patient survival, as Onyx believes. But then again, there are legitimate questions about that claim that won't be resolved until we see data from the phase III study.

A lot of this debate may seem too detailed for the average investor to worry about, but the minutiae is important because kidney cancer is a relatively rare cancer type and does not represent a very large commercial market -- $400 million to $600 million in the U.S. and Europe.

Recall that Onyx has to share sales and profits of BAY 43-9006 with Bayer. If Pfizer and its kidney cancer drug SU-11248 beat BAY 43-9006 to approval and launch, Onyx could be squeezed even further. The story gets more troublesome if Pfizer's drug proves itself to be clinically stronger than BAY 43-9006 --something some observers believe, especially after seeing data on the drug last spring.

Drug development is hard work. Too often, investors fall in love with drugs that show early promise, only to be disappointed later when reality can't keep pace with expectations. On Monday, Onyx investors learned this lesson the hard way.