These clinical trial results translated into a material re-rating of the company’s valuation.
On January 1 2019 Kazia shares traded at 34 cents. On December 31 2019 they traded at 60 cents.
Kazia chairman Iain Ross noted in his letter to shareholders that the importance of the company’s work has begun to be recognised in the market, and he believes there is much more to come.
Following is an extract from the chairman’s letter:
In December, our GDC-0084 program received final confirmation from the World Health Organisation that its formal name would become paxalisib. This is an important coming of age for a drug in development and symbolises the fact that the program is now very well-advanced on its journey to commercialisation.
We reported initial data from the ongoing phase 2 clinical trial in glioblastoma at the prestigious Society for Neuro-Oncology scientific conference in November 2019. The significance of this data cannot be overstated. For the first time, we have concrete signals of clinical efficacy in the exact patient population that is targeted for commercialisation. Put simply, on all available evidence, paxalisib works. Almost no cancer drug is curative, but the ability to delay the progress of disease is extremely material to patients, clinicians, regulators, and payors. If our longer-term results confirm the early indications that paxalisib can prolong life, that will be a remarkable achievement. In the meantime, the body of data that is emerging for paxalisib confirms its status as a very serious contender in the global fight against this most devastating of cancers.
Emboldened by this very promising data, and encouraged by the ever-growing enthusiasm of clinicians, our focus in recent months has been to chart the next stage of paxalisib’s development. To be clear, this will be a pivotal study, the final stage in the complex and lengthy development of a new medicine. We plan to join an international platform study called GBM AGILE, which has been established by the leading experts in brain cancer to help new drugs reach approval more swiftly and more cost-effectively. Participation in GBM AGILE gives us access to a world-class clinical study, on a scale that we could not replicate ourselves, with the validation of very strong support from clinicians and regulators. It is the perfect way forward for our drug, and a fitting final chapter to its development, which has been extraordinary in many ways. Paxalisib has already been approved by the study’s scientific review committee, and set-up work is currently underway. We hope to begin recruitment of patients in the second half of calendar 2020.
Meanwhile, we have four additional clinical studies of paxalisib underway in other forms of brain cancer, and all of these are progressing very well. I have said before that this is a program whose breadth would be the envy of a much larger company. We expect to see initial data out of several of these studies during the year ahead. If they too report positive data, it will give us even greater confidence in the therapeutic potential of paxalisib and will point the way to other commercial opportunities for the drug.
2019 was also a very positive year for the Cantrixil program, with positive data reported from the ongoing phase I study in ovarian cancer. Despite being tested in an extremely late-stage, treatmentresistant group of patients, we have seen evidence that Cantrixil can shrink tumours and potentially delay disease progression. This is a significant achievement, and we look forward to sharing further data. The study is already fully recruited, with a number of patients still in follow up, and we expect to definitively conclude the study this calendar year.
The future direction for Cantrixil has been a topic of some discussion at the Board, and I had the pleasure of meeting the Principal Investigator on the study late last year to take his advice. His excitement towards Cantrixil was palpable and helped to bring home to all of us that we have a promising drug on our hands. Nevertheless, our view at this point is that the further progression of the Cantrixil program is likely to be best served by the involvement of a larger company, one which brings complementary technical capabilities and one with which Kazia can share risk and cost. We are in discussions with a number of parties and look forward to sharing the outcome of those discussions as and when they mature. Partnering of pharmaceutical assets can be a protracted process, and our first priority is to ensure that anyone involved in Cantrixil is able to do justice to the potential we see in the program.
In October 2019, we completed a small institutional placement of $4 million. As in previous years, this financing round was positioned to raise just what we needed to deliver the next round of value-driving data read-outs, no more and no less. We have already put some of the proceeds to good use in launching preparatory work for GBM AGILE. Just as important, the success of this financing round, and of our previous round in 2018, demonstrate that Kazia is, in a fundamental sense, highly investable for professional investors.