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Tocagen Stock Tanks After Gene Therapy Drug for Brain Cancer Fails

Xconomy San Diego — 

Tocagen’s experimental gene therapy for brain cancer therapy has failed a late-stage test, sinking the biotech’s stock price below $1.

San Diego’s Tocagen (NASDAQ: TOCA), has been testing its drug in recurrent high-grade glioma, the most common and deadly type of brain cancer in adults. The company said Thursday that the drug combination, Toca 511 and Toca FC, didn’t prolong patient survival in the Phase 3 trial compared to chemotherapy, the standard treatment. The experimental Tocagen therapy also didn’t meet any of its secondary goals.

About 400 patients with brain tumors—including glioblastomas, the most aggressive form of brain cancer—that had returned after previous treatment were enrolled in the trial, known as Toca 5. The median length of survival for patients that received Tocagen’s treatment was 11.1 months compared to 12.2 month for those receiving chemotherapy.

Tocagen’s approach to gene therapy aims to activate a patient’s immune system to fight cancer. Toca 511 is an injectable retrovirus. It carries genetic instructions for making an enzyme that, once in cancer cells, turns Toca FC, an antifungal compound, into what’s called 5-fluoracil, a widely used cancer drug.

The failure of the Tocagen therapy confirms investors’ fears that were sparked this May after an interim look at patient survival data failed to show patient benefit from treatment. As a result, the study did not end early and instead continued, with Tocagen hoping that more time would lead to better data. Tocagan’s stock price dropped sharply at the time as investors worried the decision indicated the data weren’t promising.

Tocagen entered the public markets in April 2017, raising $85 million to advance its investigational gene therapy. The company priced its shares at $10 apiece.

Later that year it got the green light from the FDA to combine its planned Phase 2 and Phase 3 trials into a “seamless pivotal trial” after it reported that five patients treated with Toca 511 and Toca FC were still alive after nearly 36 months. The median survival rate for patients with high-grade glioma is seven to nine months.

In 2018, it licensed the experimental treatment to Beijing-based ApolloBio for $16 million up front.

“We are disappointed that the Phase 3 results did not replicate the promise of the Phase 1 results across the intent-to-treat population,” Tocagen CEO Marty Duvall said on a conference call.

The company plans to present results at a future medical conference, likely in the fourth quarter of the year, after fully analyzing the data.

Tocagen will also be conducting an “operational review” of the business, Duvall said. At the end of the second quarter, the biotech had $68 million in cash. The company’s stock was trading at about 90 cents apiece shortly after 11 a.m.; it closed Wednesday at $4.18 per share.