FDA seeks more data on cancer vaccine

LONDON/CHICAGO (Reuters) - U.S. regulators demanded more data before approving a novel prostate cancer vaccine from Dendreon Corp. (DNDN.O), sending the U.S. biotech company's shares down 64 percent on Wednesday.

Dendreon said the Food and Drug Administration issued a so-called "approvable letter" for Provenge but wanted additional clinical data to support its effectiveness. It also requested more information about chemistry, manufacturing and controls.

The stock more than doubled in a single session just over a month ago when an FDA advisory panel recommended approval for the vaccine, called Provenge.

At the contentious FDA advisory panel meeting in late March, some experts debated whether the company's evidence was convincing enough to prove the drug was effective. The panel concluded it appeared reasonably safe, and there was "substantial evidence" of its benefits.

However, Dendreon's two main studies failed to meet their main goal of slowing the progress of advanced prostate cancer, although one analysis found patients lived about 4.5 months longer.

The delay caused by the demand for more data "exposes the firm to risk that (an ongoing clinical) trial does not demonstrate the requisite improvement in survival," Next Generation analyst Liisa Bayko wrote in a research note. She wrote that she now expects the earliest it could be approved is 2011.

She added that Dendreon has "lost a key competitive advantage" over other drugs in testing for advanced prostate cancer, including one by Cell Genesys Inc. CEGE.O.

Provenge is a cancer vaccine designed to stimulate the body's immune system to fight an existing cancer. It differs from traditional vaccines that prevent infections in people not yet sick.

"We are disappointed that this decision will cause a delay in the availability of Provenge for patients who suffer from advanced prostate cancer," Mitchell Gold, Dendreon's president and chief executive, said in a statement.

A Dendreon spokeswoman said the company was still trying to discern what specifically the FDA requires.

The FDA defended its decision and said it was committed to working with the company to expeditiously obtain and review new data.

"Our review staff reviewed the available scientific data and has carefully considered all of the input from the advisory committee members ... several members raised issues about the strength of the data supporting efficacy," FDA spokeswoman Karen Riley said.

The FDA also noted that it was not bound by law to follow the panel's advice.

STANDARD OF EFFECTIVENESS

David Miller, president of independent analyst firm Biotech Stock Research, attended the FDA panel and said that because the company's studies began roughly 8 years ago, the primary goal or "endpoint," as it is known, became a source of debate.

At the time the trial began it was standard to use tumor progression as a study goal, but since then a standard of patient survival has been established, he said.

Skepticism about Provenge has been reflected in heavy short selling of Dendreon stock, with 33.9 million shares sold short in April, up from 26.4 million in March and 13 million in December, according to Nasdaq figures.

Short sellers borrow a company's stock for sale and profit by buying it back later at a lower price.

Prostate cancer will be diagnosed in about 218,000 U.S. men in 2007 and kill 27,000, the American Cancer Society estimates.

Provenge was studied in men with advanced prostate cancer that had stopped responding to hormone therapy but was not causing pain.

If Provenge eventually wins FDA approval, it could boost the emerging field of cancer vaccines. Several companies including GlaxoSmithKline Plc (GSK.L) are working on similar products for various types of tumors.

Dendreon shares closed down 64.32 percent at $6.33 on Nasdaq.

(Additional reporting by Susan Heavey in Washington)