UPDATE 2-Curis says Roche seeks more analysis of cancer drug

Mon Aug 9, 2010 1:53pm EDT

* Drug tested for ovarian cancer patients

* Partner says more analysis needed to clarify efficacy

* Shares fall as much as 17 percent (Adds analyst comment, updates stock movement)

Aug 9 (Reuters) - Drug developer Curis Inc (CRIS.O) said partner Roche Holding AG (ROG.VX) informed it that preliminary findings from a mid-stage study of their experimental cancer drug, "warranted additional investigation" to clarify the drug's efficacy in treating advanced ovarian cancer patients.

Curis shares fell 11 percent to $1.55 Monday afternoon on Nasdaq. They touched a low of $1.45 earlier in the day.

"This news does not send a positive signal to investors ... the news omits what is evident to us at this point that the primary endpoint of the study was not or will not be met," Roth Capital Partners analyst Joseph Pantginis said.

Roche and its unit Genentech indicated that they plan to further analyze the data, including subset analyses, in the coming months, Curis said in a statement.

"Following these analyses, (Roche and Genentech) expect to make a portfolio decision regarding whether, or to what extent, they will continue development of the drug in advanced ovarian cancer," Curis said.

The preliminary trial data however showed no new safety concerns, Curis said.

In June, the drug, code-named GDC-0449, failed to meet its goals in a mid-stage trial in patients with metastatic colorectal cancer.

Analyst Pantginis, who cut his price target on the stock to $3.00 from $3.50, said the recent failure in colorectal cancer and ovarian cancer further decreased confidence in the drug.

The drug, which is also being developed for several other indications, is part of a new class of medicines that block the Hedgehog signaling pathway, the malfunction of which plays a role in abnormal cell growth. [ID:nSGE65F0G0]

Pantginis now expects only a 40 percent chance for the drug's success in treating basal cell carcinoma (BCC) or skin cancer, its other closely watched indication. He previously had a 60 percent expectation of success.

Roche and Genentech indicated that it expects data from a privotal mid-stage trial evaluating the drug for treating advanced BCC in 2011. (Reporting by Krishnakali Sengupta in Bangalore; Editing by Prem Udayabhanu, Anthony Kurian)

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