Seattle Genetics Sees Case of PML, Causing Market Twitch

12/1/11Follow @xconomy

Seattle Genetics has had a bit of a dust-up today in the stock market, as investors have been seeking to make sense of a second case of a dangerous adverse event seen in a patient on the company’s new lymphoma drug.

Shares of the company (NASDAQ: SGEN) dipped almost 6 percent early in the day, after Wall Street analyst Elliot Favus circulated a report about how a second case of progressive multifocal leukoencephalopathy (PML) has been diagnosed in a patient taking the company’s flagship lymphoma drug. Favus, known for his bearish positions, didn’t immediately respond to a request for a copy of his report.

Seattle Genetics stock regained much of its value as the day went on, but news on PML is bound to rattle nerves on Wall Street. That’s because this condition is a rare, and sometimes deadly, brain infection that patients sometimes get when taking modern targeted biologic drugs like Biogen Idec’s natalizumab (Tysabri), and Roche/Genentech’s rituximab (Rituxan). The Tysabri case in particular made headlines, and prompted that drug to be temporarily withdrawn from the market, until scientists better understood the risks and benefits. Since Seattle Genetics’ brentuximab vedotin (Adcetris) only arrived on the market in August, and Seattle Genetics depends heavily on it as its only marketed product, it’s understandable why investors got jumpy.

The Seattle Genetics drug, for patients with Hodgkin’s lymphoma and anaplastic large cell lymphoma, has shown impressive effectiveness in clinical trials. It provided significant tumor shrinkage in 75 percent of patients with relapsed forms of Hodgkin’s disease in a clinical trial, and in about 86 percent of patients with anaplastic large-cell lymphoma. Researchers are still following patients to see how long those responses really do last, and to what extent they may help people live longer. The most common side effects found in clinical trials were a depletion in infection-fighting white blood cells, nerve damage in the fingers and toes, fatigue, nausea, and anemia.

Clay Siegall

CEO Clay Siegall offered a spirited defense of his product today when I reached him by phone. The PML association with Adcetris isn’t new, he said, as the first page of the product’s FDA approved prescribing information includes a warning about the condition. The warning says that a patient in clinical trials, who had received four prior chemotherapy regimens before getting Adcetris, died from PML.

Siegall did confirm that a more recent, second case of PML in an Adcetris patient has been diagnosed. That case was reported to the company, which shared with the information with the FDA. He wouldn’t comment on the patient’s condition, saying that it is company policy not to talk about individual patients.

To provide some context, Siegall notes that PML is part of the underlying disease that some patients have with lymphomas. In some cases, patients get multiple rounds of chemotherapy, which suppresses their immune systems, and makes them more vulnerable to … Next Page »

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