OncoGenex Stays in Prostate Cancer Fray, After J&J, Medivation

1/27/12Follow @xconomy

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resists the usual hormone-deprivation therapy, and randomly assigned them to get ordinary prednisone or prednisone plus the OncoGenex drug, OGX-427. Since the Hsp27 target is found in many different cancers, the company is also testing the drug in other settings, and also expects to see results from an early-stage study of bladder cancer patients.

Not many on Wall Street appear to be expecting much from these small studies. “Should Phase II data appear promising, we will incorporate OGX‐427 into our valuation,” wrote Katherine Xu, an analyst with William Blair, in a Jan. 24 note to clients.

Given that OncoGenex is a small company, with 36 employees and about $69 million in cash according to its last financial statement, there are limits to how fast it can move ahead with more than one drug in clinical trials.

Burris says OncoGenex has enough money to operate the business into 2014, at which point it expects to see the pivotal survival results from its lead drug candidate, custersin. But she also recognizes that’s a long time for investors to wait around for a single make-or-break company event. So OncoGenex will have to decide how aggressively to move ahead with the OGX-427 development plan, based on what it hears from investors and researchers next week in San Francisco, and based on the resources it has to work with. We’ll have a clearer sense of where the program is going next Thursday.

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