Kazia Therapeutics Ltd (ASX:KZA) (NASDAQ:KZIA) shares have surged 66% over the last one month from 80 cents to A$1.33 as it progresses its ongoing Phase IIa study of paxalisib in glioblastoma multiforme (GBM), a cancer affecting the brain or spine.
Edison Investment Research has increased its valuation on Kazia to A$2.04 per share from A$1.54 per share, which it says “is driven by increasing our probability of success for paxalisib in GBM to 35% (A$212.5m) from 20% (A$114.6m) and the October A$25m raise (31.5m shares at A$0.80).”
The following is an extract from Edison’s research update:
Kazia presented the results from a new interim data analysis of its ongoing Phase IIa study of paxalisib in glioblastoma multiforme (GBM). The data were consistent with previous data and showed progression-free survival (PFS) of 8.4 months and overall survival (OS) of 17.5 months. Importantly, Kazia also published some of the first safety data at the full 60mg dose, which show an attractive profile compared to other members of this class.
Pivotal studies here we come
The company presented the data from the study at the Society for Neuro-Oncology (SNO) meeting on 19 November 2020. The study is a dose-escalation/expansion study, which previously established 60mg as the maximum tolerated dose (MTD), and is currently in the Phase IIa expansion portion. A total of 29 patients were included in the analysis, of which 24 received the 60mg dose. The study is expected to continue to follow these patients into H121, but the company is not waiting to progress the program and expects to enrol the first patient into the pivotal GBM AGILE study in early calendar Q121.
Efficacy looks good, safety is key
The PFS and OS currently being reported are very similar to previous reports (8.5 and 17.7 months with n=27), which were promising the first time and it is good to see this consistency. However, the real game changer in this release is the safety data, which give us a much higher degree of confidence in this program. The PI3K class of drugs has historically been difficult to develop without high-risk adverse events such as opportunistic infections or GI complications, but the current profile from the 24 60mg patients presented shows little indication of these problems.
DIPG might need a combination approach
There was also an oral presentation at the meeting on the Phase I investigatorsponsored study of paxalisib in diffuse intrinsic pontine glioma (DIPG), an aggressive childhood brain cancer. Unfortunately, the study did not demonstrate a clear survival benefit for paxalisib, but the study authors believe there is potential in a combination.
Valuation: Increased to A$257.1m or A$2.04 per share
We have increased our valuation to A$257.1m or A$2.04 per share from A$145m or A$1.54 per share. This is driven by increasing our probability of success for paxalisib in GBM to 35% (A$212.5m) from 20% (A$114.6m) and the October A$25m raise (31.5m shares at A$0.80).
