InDex’s Ulcerative Colitis Drug Experiences Failure in Phase 3 Review

The Swedish biotech InDex has delivered surprising news to investors, announcing the premature termination of a phase 3 ulcerative colitis trial due to less-than-stellar efficacy.

The halted study focused on cobitolimod, a TLR9 agonist administered directly to the inflamed colon through an enema. InDex had positioned this approach as a rapid means to accelerate mucosal healing and alleviate ulcerative colitis symptoms, all while avoiding the complexities associated with systemic exposure and off-target impacts. The company had recently expressed optimism about the drug’s potential to achieve blockbuster sales, even securing a deal with Viatris in Japan.

The buoyant outlook took a swift downturn following the close of the Swedish market on Tuesday. InDex Pharmaceuticals disclosed the results of an interim analysis involving the initial 133 patients enrolled in its phase 3 trial, indicating an unfavorable likelihood of meeting the primary endpoint. This analysis, created to assess futility and determine the optimal dosage, led the independent data monitoring committee to advise the stopping of the study.

Jenny Sundqvist, InDe CEO, remarked, “This surprising and disappointing news confirms the complexity of the disease and the need for further research within this field, especially as moderate to severe ulcerative colitis is an indication with high unmet medical need for new treatment options. We will conduct a comprehensive analysis of all the study data before announcing next steps.”

Sundqvist refrained from speculating on the ramifications of the trial failure for InDex as a company. However, she acknowledged that one potential scenario, contingent on the data review outcome, could involve liquidation and the handing over of its cash reserves to investors.

The initiation phase of the trial focused on evaluating the percentage of patients in clinical remission at the 6th week, at which stage they had been administered two rounds of cobitolimod or a placebo. While there were no identified safety concerns, the analysis of the initial 30% of the planned participants indicated that neither dosage was poised to surpass the remission rate achieved by the placebo.

This news prompted investors to react swiftly, causing a 60% decline in InDex’s share price to 0.27 Swedish krona. The significant market correction underscores the rapid reevaluation of prospects for the biotech’s primary candidate. Initially, InDex had anticipated that the therapy could secure a substantial market share of between 20 and 30% in the moderate to severe left-sided ulcerative colitis market, translating into potential sales exceeding $1 billion.

In its endeavor to showcase the potential of the program, the biotech did achieve some noteworthy results. Notably, Viatris committed $10 million for the Japanese rights to the candidate in May, marking the beginning of a deal that could reach up to $40 million, encompassing development and sales milestones. The upfront payment contributed to InDex’s financial position, boosting its cash reserves to just over 412 million Swedish krona ($39.5 million) by the close of June.

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