* No improvement seen in clinical outcomes
* 30 mg dose raises dystrophin 22.5 pct in 24 weeks
By Deena Beasley and Anand Basu
April 2 A small trial of U.S.-based AVI BioPharma Inc's experimental muscular dystrophy drug met its goal of increasing levels of a key protein, but did not demonstrate that the drug had an impact on walking ability at 24 weeks.
AVI shares were trading down 24 percent at $1.17 in morning trade on Monday on the Nasdaq. They had touched $1.06 earlier in the session.
"The unfortunate thing is that 24 weeks is not long enough ...(for) a clinical benefit to be seen," a company executive said on a conference call.
AVI, however, indicated that a longer dosage period could result in a favorable clinical outcome. The company is still collecting data from an open label extension trial, which will last for 48 weeks.
It expects to get the initial data from the 48-week dosage period in late July and additional data in the second half of this year.
"We are going to be looking closely at the open label extension phase because that could indicate expected clinical outcome as well a s how we design and power our pivotal study," the company said.
WBB Securities analyst Stephen Brozak said investors would be interested to know if the drug improves walking ability over a longer duration. "Now, they have got to come out with additional information to assuage concerns," he said.
The mid-stage trial, or Phase IIb, which involved 12 boys with Duchenne muscular dystrophy, found that the four patients treated for 24 weeks with a 30 mg dose of the drug, eteplirsen, had a 22.5 percent average increase in levels of dystrophin, a protein essential to building muscle, compared to no increase for four patients treated with a placebo.
Duchenne muscular dystrophy -- a muscle degeneration disease affecting young children, almost exclusively boys -- leads to paralysis and death in young adulthood. At least 250,000 people worldwide are believed to be afflicted with the disease.
Eteplirsen is designed to silence a specific strand of RNA so that the body can produce the dystrophin that people with Duchenne muscular dystrophy are unable to produce.
The trial found that the four patients treated for 12 weeks with a 50 mg dose of the drug did not show a significant increase in dystrophin, suggesting that a longer duration of dosing is needed.
It also found no significant improvements in clinical outcomes, including a six-minute walk test, in the treated groups compared to placebo.
"We anticipate that these levels of dystrophin could lead to significant clinical benefit if maintained over a longer course of treatment," Dr. Jerry Mendell, director of the Centers for Gene Therapy and Muscular Dystrophy at Nationwide Children's Hospital in Columbus, Ohio and the study's lead investigator, said in a statement.
There were no treatment-related adverse events, no serious side effects, and no evidence of kidney toxicity.
AVI BioPharma Chief Executive Officer Chris Garabedian said the company plans to discuss with U.S. regulators how best to conduct a longer pivotal trial of the drug.
"The hope is that if we can delay or halt the progression of the disease we would be able to avoid these kids ending up in a wheelchair," he said. "It would avoid the need for ventilators, maybe even prevent death."
Eteplirsen is designed to skip a specific "exon," or protein-coding sequence of the dystrophin gene that is mutated in about 15 percent of people with Duchenne muscular dystrophy.
AVI BioPharma is also developing drugs targeting other exon mutations responsible for muscular dystrophy.
Garabedian said he would prefer raising funding for a pivotal trial from capital markets, rather than a partnership.
"In the rare disease area, it doesn't take a large commercial infrastructure to do this," he said.