Maxim Affirms Onconova Therapeutics (ONTX) at 'Buy' Following End-of-Phase 2 Meeting w/ FDA
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Maxim affirms Onconova Therapeutics (Nasdaq: ONTX) at Buy with a price target of $6 after the company announced receipt of the End-of-Phase 2 meeting minutes from the U.S. Food and Drug Administration (FDA) for the combination of oral rigosertib with azacitidine for the treatment of patients with higher-risk myelodysplastic syndromes (HR-MDS).
The firm noted the following:
- Onconova announced completion of end-of-phase II meetings with the FDA for the combination of oral rigosertib and azacitidine, and is now moving forward to design a pivotal phase III study in patients with first-line higher-risk myelodysplastic syndromes (HR-MDS).
- The phase II data demonstrated that combination therapy induced an overall response rate of 77% (23/30 evaluable patients). The data were presented at ASH 2015 (LINK) and ASCO in June 2016 (LINK). Additional long-term data from the study is expected at ASH this December, as are details of the phase III design.
- Recall that rigosertib is currently being evaluated in a pivotal phase III study ("INSPIRE") as an IV-based treatment for second-line HR-MDS (interim data 2H17, 88 events). The pivotal program in first-line HR-MDS will likely evaluate overall response rate (ORR), which is a composite of complete remission (CR) and partial remission (PR) (see phase II data below).
- Conclusion. Rigosertib continues to advance in second-line HR-MDS and is now heading towards a pivotal program as a first-line therapy in combination with SOC. However, we continue to see Onconova as a phase III company trading at a "distressed" valuation due to the disconnect between a prior study failure and the current "intelligent" design of the INSPIRE study. As such, the prior and current data for rigosertib, as well as the market opportunity in MDS (high unmet need), create a positive risk/reward scenario for investors, in our view.
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