How to Review Biotech Clinical Data

Introgen Therapeutics (INGN Quote) on Sunday presented new clinical data on its gene therapy drug Advexin. Unfortunately, the new information does little to rehabilitate Introgen's reputation as one of the biotech sector's worst dissemblers.

I've made no secret of my low opinion of Introgen, its drug Advexin or management, which I believe have bamboozled investors for years. Fortunately, the tricks and spin aren't working as well as they used to for CEO David Nance and his Austin, Texas, gang.

In the few days since the Sunday release of the new Advexin data, Introgen shares are off roughly 8%.

Sensible investors have long ago written off Introgen (except short-sellers, for obvious reasons). But the company is still worth covering because there's a teaching moment with almost every press release. Introgen is like a living textbook for what investors need to be wary of when considering a biotech investment.

At a cancer conference in San Diego on Sunday, Introgen presented what it claims was positive interim data from a phase III study of Advexin treating patients with cancer of the head and neck. The company says the new data confirms the efficacy of Advexin -- including a survival benefit for these patients -- seen in a previous phase II study. Introgen says it will use this data to seek approval for Advexin in the U.S. and Europe later this quarter.

To download a PDF version of poster of the new Advexin data, click here or here. Don't rely on company-issued press releases. Go directly to the data source. If a poster is not publicly available, call up the company and ask for it. If they say no, ask yourself what they're hiding.

Let's go through the Advexin poster to highlight its multiple red flags. This is stuff that is broadly applicable. If you can spot red flags in clinical data presentations, you can avoid getting suckered into biotech money traps.

There are plenty of good biotech companies focused on cancer drugs for investors to consider. Genentech (DNA Quote) and Celgene (CELG Quote) top the list, of course, but there's also ImClone Systems (IMCL Quote), Onyx Pharmaceuticals (ONXX Quote) and OSI Pharmaceuticals (OSIP Quote). One reason these companies are tops is because you won't find them taking shortcuts with clinical research.

But never assume anything, especially when doing due diligence on developmental-stage cancer companies like Exelixis (EXEL Quote), Arqule (ARQL Quote), Cougar Biotechnology (CGRB Quote) and Synta Pharmaceuticals (SNTA Quote), to name a handful.

Use the tips below in your due diligence and you'll be a savvier biotech investor.

Why's a Corporate Lawyer Meddling With Scientific Data?

Let's start with something strange; something I've never seen before in all my years reading and collecting scientific posters. The Advexin poster begins with a legal disclaimer and a safe harbor, or forward-looking, statement from Introgen's legal department.

Everyone should be familiar with this corporate legalese; it's the thing CEOs say before they make corporate presentations or speak with investors that protects the company from being sued if the future projections the executive makes don't turn out exactly as planned.

Safe harbor statements are common stuff, but I've never seen one on a medical or scientific poster. That's strange. I asked Introgen to explain why it felt compelled to place a warning on its Advexin poster; the company wouldn't answer my question.

Follow the Ns

By Ns, I'm talking about the number (N) of patients enrolled in a clinical trial. One of the most important things you can do when evaluating clinical data is to make sure that analyses are conducted on all patients enrolled in the trial. If patients are missing, you should start asking questions.