Infinity Pharmaceuticals is regaining full commercial rights to develop cancer drugs that block a target called heat shock protein 90. The biotech company’s partner, London-based drugmaker AstraZeneca, decided to hand back its 50 percent stake in the program to its partner Cambridge, MA-based Infinity (NASDAQ: INFI)

This news could be spun a couple ways. It could mean AstraZeneca thinks the program is a dud, which is what investors seemed to think this morning, when they drove down Infinity shares 19 percent, as Reuters reported. Or, it could mean something else that isn’t being disclosed, like AstraZeneca just decided to bail out because it didn’t have enough skin in the game to get a return on the development money it’s poured into the program. That’s what analyst Simon Simeonidis of Rodman & Renshaw suggested in a note to clients this morning. He had a more bullish take on the news.

“We see any pullback today as a buying opportunity for investors with a long-term horizon,” Simeonidis wrote.

However you choose to interpret this, Infinity will shoulder more of the risk and reward with this program. The drugs Infinity will get back include IPI-504 (retaspimycin hydrochloride for injection). It is in a final-stage clinical trial for treating patients with relapsed forms of a stomach malignancy called gastrointestinal stromal tumors. Another version made into an oral pill, called IPI-493, entered its first clinical trial over the summer in patients with advanced solid tumors. Both drugs are meant to block Hsp-90, a protein that works like a chaperone to cancer-causing proteins like c-Kit, EGFR, and HER2. The Hsp-90 protein is thought to support and stabilize those tumor growth proteins.

Knocking out this cellular underpinning for those tumor growth proteins appeared to help patients, according to research presented at the American Society of Clinical Oncology meeting in May. That’s when Infinity showed it could stabilize tumors for two-thirds of patients in a study of 36 patients, and keep tumors from spreading for about three months in patients who failed on all other treatments. That result was good enough to convince the FDA that this drug should head straight from a small trial to the final stage of development, which could lead to market approval. Infinity hopes to bring the first drug of this class to the U.S. market.

“By regaining full control over IPI-504 and IPI-493, we believe we will maximize the medical and commercial potential of our Hsp90 program,” said Steve Holtzman, Infinity’s chairman and CEO, in a company statement.

Since other drugs are already aimed at the other targets mentioned above, an Hsp-90 blocker may be useful in combination treatment, said Infinity’s chief scientist, Julian Adams, in an interview with me in May. The combo approach has potential against multiple forms of cancer, including lung and prostate tumors, which were in the company’s development plan at the time.

Infinity said it has enough financial wherewithal to carry this program ahead on its own. AstraZeneca agreed to pay its share of development costs for another six months. Infinity also bolstered its financial position a few weeks ago, when it formed a partnership with Purdue Pharma that brought in $75 million in upfront cash to obtain co-development rights to other research programs, including an Infinity product that blocks the “hedgehog” target on cells. After opening trading today at below $6 a share, investors seemed to warm up a little more to the idea that Infinity may be able to pull this off. Still, the stock was down 3 percent, to just under $7 in early afternoon trading.

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Cambridge, MA-based Curis (NASDAQ: CRIS) said today it will receive a $3 million cash payment from its partner, Genentech (NYSE: DNA). The payment is due because Genentech is starting a clinical trial among patients with ovarian cancer. Researchers will look at 100 patients with the disease, taking either a placebo or GDC-0449, an oral pill made to block the action of the Hedgehog pathway, which is thought to be critical to the survival of cancer cells and their ability to resist chemotherapy.

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Infinity Pharmaceuticals, the Cambridge, MA-based developer of cancer drugs, said today it has started an early-stage clinical trial of 30 to 50 patients with advanced solid tumors, or those that have spread. The company (NASDAQ: INFI) will test IPI-926, an orally-given blocker of the hedgehog pathway, which researchers say can play a central role in tumor growth when it becomes overactivated.

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