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Oncternal Therapeutics Goes Public After Reverse Merger With GTx

Xconomy San Diego — 

Oncternal Therapeutics has joined the growing ranks of San Diego biotechs to go public, but it didn’t go through an IPO to get there.

The San Diego-based company said Monday that it completed a reverse merger with GTx, a Memphis, TN biotech whose market value plummeted last fall after its lead drug candidate failed a Phase 2 trial.

GTx had been testing a therapy for post-menopausal women with stress urinary incontinence, a condition that can cause a person to unintentionally lose urine during physical activity. But the experimental drug, a selective androgen receptor modulator called enobosarm that aimed to limit how often the condition occurred, wasn’t able to show a statistically significant improvement compared to a placebo in a trial with nearly 500 women. It was the company’s only clinical-stage candidate; it had a preclinical drug focused on castration-resistant prostate cancer, too.

Meanwhile, Oncternal (NASDAQ: ONCT) is in the midst of early-stage testing of its lead drug candidate, cirmtuzumab, which is being studied in combination with AbbVie’s (NYSE: ABBV) cancer drug ibrutinib (Imbruvica) for the treatment of chronic lymphocytic leukemia and mantle cell lymphoma.

Ibrutinib targets a protein called Bruton’s tyrosine kinase, which plays a key role in the expansion of chronic lymphocytic leukemia, the most prevalent form of the cancer that starts in the bone marrow and can get into the blood. Cirmtuzumab targets a receptor, known as ROR1, found on some tumor cells.

The theory behind the combo is that inhibiting the protein that ibrutinib targets will increase the benefit of cirmtuzumab, which inhibits growth of tumor cells by targeting ROR1, according to Michael Choi, a UC San Diego Moores Cancer Center investigator who is working on the study. Ibrutinib, a multi-billion-dollar drug that became the standard of care for newly diagnosed chronic lymphocytic leukemia patients, was at the center of a $21 billion buyout by AbbVie in 2015.

Oncternal said it has seen promising results. Of 12 patients who received 24 weeks or more of treatment during a Phase 1/2 study, 11 saw a partial or complete response—meaning there no longer evidence of the cancer or that it had been reduced significantly, according to interim data presented last week at the annual meeting of the American Society of Clinical Oncology in Chicago. And the drug combination appeared to be well-tolerated, the company said, with those receiving it experiencing only adverse events typical for those getting ibrutinib by itself, and no dose-limiting toxicities attributed to cirmtuzumab. Two patients stopped the treatment for reasons unrelated to cirmtuzumab, according to Oncternal.

The company said it will report updated results later this year.

Oncternal is also testing the experimental drug in combination with paclitaxel, a chemotherapy, for women with metastatic breast cancer at UC San Diego’s School of Medicine. The cirmtuzumab program is backed by funding from the California Institute for Regenerative Medicine.

The company is also in Phase 1 testing for another molecule, TK216, which is designed to inhibit a family of proteins associated with tumor cell growth; it’s being tested alone and in combination with vincristine, a chemotherapy drug, in patients with relapsed or refractory Ewing sarcoma, a rare pediatric cancer. Oncternal also plans to test the experimental drug in patients with relapsed acute myeloid leukemia. Oncternal also has a CAR-T program targeting ROR1 in preclinical development.

On Monday the combined company’s shares began trading on the Nasdaq exchange under the ticker symbol “ONCT.” The privately held Oncternal and GTx, which went public in 2004, announced in March that the companies had agreed to merge.

When the companies revealed the agreement, they said the merged entity would have about $26 million in cash and short-term investments—enough to fund Oncternal’s programs into the second quarter of 2020, including a Phase 2 study of cirmtuzumab and ibrutinib. The funds are also expected to cover studies of the drug focused on castration-resistant prostate cancer that was in preclinical development at GTx, in anticipation of asking the FDA for permission to start human testing.

Shareholders of Oncternal received roughly 75 percent ownership of the merged company, according to a news release. In addition to the remainder of the shares in the combined entity, GTx shareholders were also granted rights to some of the proceeds if Ocnternal sells or develops products using the programs and technology it received as a result of the merger.