Almost all patients with multiple myeloma who survive initial treatment eventually will relapse and require further therapy. That might be one of the reasons the FDA is likely to quickly approve the Onyx (NASDAQ:ONXX) cancer drug carfilzomib, which is intended to treat patients with relapsed and refractory multiple myeloma.
The South San Francisco, Calif.-based biopharma company recently submitted its New Drug Application for carfilzomib under an accelerated approval process. When the drug eventually hits the market — probably sometime in 2012 — it has the chance to give Onyx the financial oomph needed to stop merely treading water and start putting up some positive earnings numbers. Doing so would go a long way toward convincing investors that the company has the staying power to justify their support.
Onyx can only hope the FDA shares the company’s enthusiasm about the carfilzomib study results. The safety and efficacy data accompanying the drug application are compelling, according to Ted W. Love, M.D., the company’s executive vice president, R&D and technical operations.
“While important strides have been made in treating patients with multiple myeloma in the last decade, this disease remains uniformly fatal, underscoring the need for new treatment options,” he added in a company news release.
Multiple myeloma is the second-most common hematologic cancer and results from an abnormality of plasma cells, usually in the bone marrow. In the United States, more than 50,000 people are living with multiple myeloma and approximately 20,000 new cases are diagnosed annually. Worldwide, more than 180,000 people are living with multiple myeloma and approximately 86,000 new cases are diagnosed annually.
Onyx, which has a market capitalization of more than $2 billion, has seen its share price ebb and flow since going public in 2002. ONXX hit an all-time high of nearly $56 in December 2007 but today trades at just $33 after a little bump up on the carfilzomib filing. All in all, Onyx is in a reasonably good cash position with $550 million on the books at the end of the second quarter.
The company garnered attention among investors in 2004 based on positive data for its advanced kidney cancer treatment Nexavar, which was granted FDA approval in 2005. The drug later was approved for liver cancer, and Onyx and its partner Bayer (PINK:BAYRY) are now testing the drug for use in other types of cancer, including breast, thyroid, colorectal and ovarian.
Bayer sells Nexavar, and Onyx gets a slice of the profits after Bayer’s expenses. Unfortunately, the revenue Onyx receives has been neutralized by the company’s operating expenses. Some investors are concerned that the Bayer-Onyx collaboration is on shaky ground. In fact, Onyx has sued Bayer, contending that a separate drug Bayer is developing for kidney cancer should be treated as part of the companies’ agreement, not as Bayer’s alone.
The two might straighten out their differences and the Nexavar tree eventually might bear more fruit for Onyx. But clearly, the company’s future and the payoff for ONXX investors is most likely riding on the success of carfilzomib.