UPDATE 1-Keryx phosphate binder succeeds in Phase 3 study

Tue Nov 30, 2010 1:01pm EST

* Zerenex meets goals of Phase III study

* 6 gram dose reduces serum phosphorus 25 percent

* 8 gram dose demonstrates 28.8 percent reduction

* Shares up more than 5 pct after initial 10 pct rise (Adds analyst comment, background, share price)

By Bill Berkrot

NEW YORK, Nov 30 (Reuters) - An experimental drug being developed by Keryx Biopharmaceuticals Inc (KERX.O) to lower abnormally high levels of phosphate in the blood of patients with advanced kidney disease met its goals in a late-stage clinical trial, the company said.

Keryx released the positive top-line data from a 146-patient, short-term Phase III study of its Zerenex phosphate binder on Tuesday, saying the drug produced highly statistically significant results at the two highest doses tested. Its shares rose as much as 10 percent after the news.

End-stage kidney patients on dialysis who received 6 grams of Zerenex per day saw their serum phosphorus levels drop 25 percent after 28 days to 5.7 milligrams per deciliter from 7.6 mg/dl. Patients who received 8 grams per day of Zerenex experienced a nearly 29 percent drop to 5.3 mg/dl from 7.5 mg/dl.

A dose of 1 gram per day failed to reduce serum phosphorus levels, according to the data.

"We are excited by the Zerenex efficacy data and believe that the product's profile continues to strengthen in its potential ability to take market share from the market leading products," Genzyme Corp's GENZ.O Renagel and Renvela, Roth Capital Partners analyst Joseph Pantginis said in a research note.

Phosphate binder sales exceeded $1 billion worldwide in 2009 with more than $700 million coming from U.S. sales.

Pantginis raised his price target on Keryx shares to $10 from $7 and, based on the data, increased his view on the likelihood of Zerenex approval to 65 percent from 35 percent.

The drug, an oral ferric iron-based phosphate binder, was given via a one gram caplet formulation, so 6 gram patients took six pills a day and 8 gram patients took 8 pills a day, the company said.

"Based on the results of this Phase 3 study, it appears that the Zerenex efficacy and safety profile is emerging in a way that could make it the phosphate binder of choice for dialysis patients," Dr. Julia Lewis, chairwoman of the Zerenex Phase III study program, said in a statement.

"We are very excited to have taken this big step forward towards bringing Zerenex to the patients who are in need of additional alternatives to the existing phosphate binders," added Lewis, professor of medicine, Department of Nephrology, at Vanderbilt University School of Medicine.

The drug appeared to be safe and well tolerated, with nine patients -- 6 percent -- dropping out of the study, the company said.

No clinically meaningful change in serum calcium was seen, but a dose-related reduction in calcium-phosphorus was observed in the study, the company said.

Elevated levels of serum calcium and high levels of calcium-phosphorus product, both of which are believed to be drawbacks associated with some currently marketed phosphate binders, increase the risk of soft tissue calcification and may contribute to serious health problems and death in patients with end-stage kidney disease.

Keryx is currently enrolling patients in a longer-term, 58-week Phase III study of the safety and efficacy of Zerenex that will be used in seeking U.S. approval to sell the drug, the company said. Keryx expects to be able file to seek U.S. approval in the first half of 2012.

Keryx shares were up 29 cents, or 5.4 percent, at $5.65 in afternoon trading on Nasdaq after rising as high as $5.91 earlier in the day. (Editing by Steve Orlofsky; editing by Andre Grenon)

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