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Biotech Stock Mailbag: Agenus, Aegerion, Ariad

The GBM patients eligible for Agenus' Prophage study all had prior surgical resection of their tumors that was no less than 90% complete. By comparison, only 39% of patients enrolled in the Stupp study had complete tumor resection.

A later analysis of the Stupp study was published just looking at patients with complete tumor resection. The median overall survival for these patients was almost 19 months, very similar to the Prophage results, especially after factoring in the relative size of these studies. Agenus enrolled 46 patients in its phase II study while the Stupp study enrolled 573 patients, including 226 patients with complete tumor resection.

In a larger, controlled phase III study, that 23.3-month median overall survival for Prophage will undoubtedly fall.

In his Seeking Alpha story, Smith takes dubious cross-trial comparisons to another level by looking at two studies of Avastin in newly diagnosed GBM patients conducted by Roche (RHHBY). The control arm in both studies was the current standard of care -- radiation and temozolomide -- with median overall survival of 16 months and 17 months, respectively.

Once again, Prophage looks better, but it's an illusion. As with Stupp, the GBM patients enrolled by Roche in its studies were generally sicker than those enrolled by Agenus. Fifty-nine percent and 42% of patients treated with standard of care entered the study with complete tumor resections.

Agenus intends to meet with the FDA so that it can move ahead with a phase III study of Prophage in newly diagnosed GBM patients. As I've shown, the clinical evidence supporting this effort is dubious, at best. But this is biotech, where it's often more important to have a drug in phase III trials than it is for that drug to have any chance of success.

That's particularly true for a company like Agenus, where raising cash is mission number one.

Investor concerns that cholesterol-lowering PCSK9 drugs, including one under development by Amgen (AMGN - Get Report), will eat into the market share and revenue generated by Aegerion Pharmaceuticals' (AEGR - Get Report) Juxtapid have resurfaced over the past week or so. The result: volatility in Aegerion's stock price. Shares hit $97 on Sept. 10 but fell to $84 on Sept. 18. The stock was rebounding Thursday as some analysts came to Aegerion's defense.
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