The

Food and Drug Administration

is scrutinizing the testing of an

Immunomedics

(IMMU) - Get Report

cancer drug at the

Garden State Cancer Center

, a Garden State executive has confirmed.

Clinical tests of the Immunomedics drug were put on hold in recent weeks, said Kevin Jones, head of the clinic's fund-raising arm. He added that the FDA is probing the "monitoring" of clinical trials at the Belleville, N.J., center. It isn't clear why trials of the unidentified Immunomedics drug were halted or who ordered them stopped.

Also recently, Malek Juweid, a senior study chair for a number of clinical trials at Garden State, resigned for undisclosed reasons. Juweid, who had worked at the center for some seven years, was in charge of at least five cancer drug clinical trial programs at Garden State, according to the Web site of the

National Cancer Institute

, which funded some of the trials. Juweid couldn't be reached for comment, but a woman identifying herself as his wife said he quit to take a job at the

University of Iowa

.

Last Thursday,

TheStreet.com

reported that according to a

Legg Mason

analyst who had spoken with Immunomedics officials, a trial of an Immunomedics drug was halted in the wake of a patient death. The company responded Friday that "no clinical trials sponsored by Immunomedics have been halted because of adverse events or deaths." But Cynthia Sullivan, Immunomedics' chief operating officer, wouldn't say whether clinical trials of Immunomedics drugs at Garden State sponsored by someone else, such as the NCI, had been halted.

The Shorts

The company has claimed that rumors of the patient death were being maliciously spread by short-sellers, who seek to profit on the decline of a stock. Immunomedics shares, which have traded as high as $41.12 in the past year and as low as $1.06, recently traded at $20.62.

Analyst Stefan Loren of Legg Mason reiterated that he was told by Garden State officials about a patient death. It is not clear whether the death resulted from the drug being tested.

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Immunomedics' Sullivan said the company is seeking to identify the source of what she said are false reports of an adverse event in an Immunomedics drug trial.

"We are doing everything we can to investigate these false rumors," said Sullivan.

"If there has been a death, I haven't heard about it," said one senior company official who declined to be identified. He said it would be "foolhardy" for a cancer center using National Cancer Institute funding to try to cover up a questionable death, since funding for all trials could be withdrawn and criminal charges could ensue.

However, this official declined to discuss the nature of the FDA investigation.

Monitoring

People familiar with the suspended Garden State clinical trial say it involved early-stage testing of a so-called humanized monoclonal antibody called LymphoCide. The drug employs a radioactive substance called yttrium-90 to seek out and kill cancer cells in non-Hodgkin's lymphoma patients. The drug has shown promise in early-stage clinical trials, and company officials say it compares favorably to Rituxan, a leading cancer drug made by

Genentech

( DNA), but is easier to use.

"The FDA has indicated some issues that need to be addressed in regard to the monitoring of certain trials," said Jones. He declines to be more specific, though he denies that a patient died during clinical trials of the unidentified Immunomedics drug.

Different Neighborhood
Tracking Immunomedics over two years

Source: BigCharts

The Food and Drug Administration never comments on ongoing inquiries, a spokesman said. The agency, which monitors clinical trials, has the authority to halt clinical trials when adverse events or deaths occur, or for other reasons, such as improper record-keeping.

The FDA action isn't uncommon, and trials can be resumed after a probe, or canceled if the drug is found to have unacceptable safety risks. In very sick patients, it is often unclear whether the drug itself is the cause of any adverse event or whether a patient would have died anyway. Larger clinical trials are often required to make such a determination.

Trials of the drug were suspended at Garden State but not at other centers where the drug is being tested, including the

University of Pennsylvania

, the

Roswell Park Cancer Institute

in Buffalo and international centers, a person familiar with the matter said. A more advanced version of LymphoCide that doesn't employ a radioactive substance continues to be tested. Calls to Roswell Park and Penn seeking confirmation that trials there continue weren't immediately returned.

Sponsorship

Immunomedics and Garden State are closely related. Garden State was founded by David Goldenberg, chairman and chief executive of Immunomedics, and Goldenberg remains president of Garden State. The Garden State center is one of a number of centers that has been conducting trials of Immunomedics drugs.

Immunomedics isn't sponsoring clinical trials at the Garden State center, Sullivan said. She said Garden State is the official sponsor of any trials it conducts. "Any trials we are sponsoring have not been halted," she said.

But Tom Davis, a senior investigator with the National Cancer Institute's cancer therapy evaluation unit, said that if Immunomedics is providing the drug to Garden State, it is effectively a sponsor.

"If Immunomedics is providing the drug, they are officially the sponsor, although there may be other people funding it," said Davis, who oversees NCI funded cancer trials.

Davis also said there's a "gray area" of potential conflicts of interest for drugs to be tested at research facilities that are managed by company executives. But he said if clinical trials have sufficient independent oversight, the NCI isn't worried.

"An institution needs to have an appropriate review board to make sure there's no blatant conflict of interest," said Davis.