dr.kss/gumshoe evaluates bit clinic protocols

Just published on Stock Gumshoe and HC BLT Thread:

[Ed. Note: Here is our second installment from Dr. KSS, formerly known as "karmaswimswami" in Gumshoe discussion threads.

Dr. KSS has agreed to our trading and disclosure restrictions, and he's not offering you personal investment or medical advice.

As with all of our columnists, we don't assign topics or opinions and do just a bit of light editing as needed -- the doctor's words and opinions are his alone.]

This column grew out of a discussion thread that began on biotechnology companies on Stock Gumshoe during January 2014.

In that thread, I introduced the unknown Australian biotech company Benitec (BLT on the ASX, BNIKF in the US), which has an extraordinary patent estate in DNA-directed silencing/inhibiting RNA and has, just in recent weeks, become a clinical-stage company.

Like many readers of that thread became, I am long BNIKF.

Benitec is the best example of a rather clever set of “young Turk” Australian biotech companies almost unknown outside the Pacific.

In 2011 and 2012, I traveled extensively in Australia and immersed myself in its biotech landscape.

Recently, another Australian biotech declared itself to investors, and is worth discussing as a case study in deciding whether a biotech issue is worth having money in.

How one analyzes it is a lesson in how to analyze any biotech company.

6 March 2014, morning in Australia.

A biotechnology company that no one has heard of squawks out a press release.

The company, Biotron, in New South Wales, reports that patients coinfected with hepatitis C (HCV) and HIV have cleared HCV with the help of a new drug it has developed called BIT225.

The news sends share prices soaring from A$0.084 briefly as high as A$0.315, to close at A$0.17, up 124 per cent.

This may seem exciting.

Or it may seem unexciting: a penny stock in a tiny company (Biotron’s market cap is only about US$37 million).

Biotron’s capital structure, however, is not uncommon among Australian companies, which often have extraordinary numbers of outstanding shares at seemingly nugatory prices.

Biotron shares trade on the US grey market as BITRF.

Biotron warrants exploring as an object lesson on how to sift through data from biotechnology companies.

Investing in this company is highly speculative (I have no stake in it), and as is often the case, a decision as to whether the company’s science and pipeline have merit is not simple.

Often what a company presents cannot be taken at face value. In this discussion, we will go deeply into one stock as an example of what is commonly practiced in medical schools, law schools and business schools: case-based learning.

Rather than give you theory with no context, let’s provide a context as a way of making theory matter.

This sort of analysis is not something a computer can do, and why many times when interesting companies come up for discussion in Gumshoe threads, it is not a trivial, slapdash matter to offer informed opinion on those companies.

According to Biotron’s press release, its recentest study was in 12 Thai patients co-infected with HIV and HCV.

The press release steers you to think that “all” of these experienced sustained virologic response (SVR) following treatment with PEG-interferon alpha-2b, ribavirin and BIT225.

You can eyeball the press release here.

On the face of it, this is exceptional news.

Let’s talk in some depth about treating HCV, as the new drugs coming for it and the compelling stories the companies with those drugs have for investors will be discussed in later columns.

SVR is the condition of having been treated for HCV, completing the full course of treatment, having the virus disappear whilst on treatment and then having it stay durably gone after treatment is stopped.

As a rule, if a patient is SVR at 12 weeks after stopping treatment (SVR-12), that patient is cured.

Virus will not come back, no matter what (even chemotherapy that knocks out the immune system does not lead to relapse) unless the patient gets exposed to HCV again (such as by drug abuse recidivism).

Biotron’s report was that patients remained SVR at 24 weeks, a little redundant in that they were known to be SVR-12.

However, using PEG-interferon alpha and ribavirin alone (the now-fading standard of care for treating HCV), SVR for patients co-infected with HCV and HIV is classically quite low, perhaps 15-20 per cent.

Even when the HIV is controlled with anti-retrovirals, HIV is immunosuppressive enough that it makes hepatitis C quite difficult to drive out.

What is BIT225?

Many years ago Biotron decided it would pursue developing an inhibitor of Vpu, a protein encoded by HIV. Vpu is a so-called viroporin.

For certain viruses, viroporins are critical for virus propagation.

A virus enters a cell and replicates, generates copies of itself, that are packaged into virions.

But the virions, new virus particles, have to get out.

In some deadly viruses, virion escape is accomplished when the infected cell dies: the cell breaks up when the virus kills it, and virions are liberated. HIV is more successful, however, because it is sneakier.

It hijacks a cell to make Vpu, and individual Vpu molecules gather together and build channels, or pores, in cell membranes. Newly-made virions jump ship via these viroporin channels.

Biotron’s reasoning was that if a drug could be devised to gunk up viroporins, this might be a good way to control HIV.

In preclinical studies, Biotron showed that BIT225 also had marked activity against the HCV viroporin.

The hepatitis C RNA strand codes for a protein called p7. In infected cells, p7 molecules cluster together to create cell membrane pores through which new HCV particles sneak out.

And in fact in an early study, when Biotron gave BIT225 alone to HCV patients for a few days, their virus burdens dropped.

When clinical study data are analyzed, there are two fundamental ways of assessing it.

As we will see, both have merits, but one approach makes data look rosier than what journal editors and the FDA demand.

In Anthony Burgess’s dystopian novel A Clockwork Orange, protagonist Alex speaks of having a pain in his “gulliver,” a portmanteau of gut and liver (Burgess was a master of slang words that were new but with obvious meaning, this one for “belly”).

Suppose there is a disease, chronic gulliveropathy, and you are a doctor who has patients with it.

A pharma company approaches you to do a study in your patients with chronic gulliveropathy (CG) because they have a new drug, X, they think will cure it.

You have 30 patients with CG. The study requires that patients take pill X for a month, after which you will see if they are cured.

Ten patients seem good candidates to be in your study, sign informed consent and after screening (for drug abuse, for non-gulliver problems that might confound the study) are cleared to be in the study.

All start taking pill X. The protocol calls for them to return in one week for follow-up.

A week later, only nine patients show up. You call the tenth patient, but her phone has been disconnected.

And no one answers when you call her emergency contact. Of those remaining nine patients, seven are doing OK.

But one of the nine remaining CG patients has been vomiting like mad, and he thinks drug X is to blame.

He didn’t call, however, and is still taking X.

Another, you find, has a shockingly low white blood cell count.

The vomiting patient doesn’t want to stay in the study.

And you do not feel that the leukopenic patient should stay on X.

You tell both to stop pill X, tell them that they are out of the trial, but ask them to come back in a week for follow-up to be sure they are OK.

You now have, altogether, three patients who are not successful study outcomes.

Seven CG patients keep taking X. But prior to the next study visit, one of them calls.

Actually it is his wife that calls. The patient has had a seizure and is in the hospital.

The doctors feel he has gotten West Nile virus and seized because of the brain infection.

You have to tell the patient that this is a serious adverse event, and that even if the study drug did not evidently cause it, he needs to stop taking X.

After all, X is investigational. Not everything is yet known about it.

If it seems I am making this convoluted, I don’t mean to be.

This is real-world clinical study drama, folks.

It is what biotech companies deal with daily in developing drugs. So, we started with 10 patients.

We are down to 6 patients with chronic gulliveropathy who are on drug X. All 6 stay on X, and seem to do OK.

And blood testing done at the final study visit confirms that, voila, all are cured of CG.

This is fabulous news, as CG never goes away spontaneously (your study has no control arm, but that CG doesn’t clear on its own is a “historical control”).

Your phase II study has seemingly done well….or has it?

You are ready to move to a phase III clinical trial….or are you?

It all depends on how you evaluate the data and present it.

One method assesses outcome only in patients that complete the study according to protocol.

This is called per protocol analysis (PPA). By PPA, you have a 100 per cent success rate.

Of the people that stayed on drug X, all of them are cured.

And based on historical controls, we know that CG just doesn’t go away spontaneously.

Thus even though you did not do a controlled study, your data has some value.

But will the FDA like this?

The FDA requires a different sort of more stringent data breakdown, called intention-to-treat analysis (ITA).

ITA requires that you look at ALL patients you screened and cleared to be in the study, and count them in reckoning the study outcome. You intended to treat them, and so whether they completed treatment or not, you have to count them in the study outcome.

This is a way of catching not only adverse effects from drugs that are known, but also adverse effects not recognized.

Some patients may go on a study drug, experience a side effect they don’t like (be it as simple as heartburn or a headache), decide they have had enough even though they do not report the seeming side effect, and vanish.

You must include people who had to stop study drug for reasons related to the drug.

And you have to include patients that didn’t show up again.

And those who blamed the drug for problems and wanted to stop…and those who withdrew their consent (for whatever reason…a paranoid neighbor may have told them they are being a guinea pig for Big Pharma) to remain in the trial.

Good ITA outcomes depend, in part, on choosing study patients carefully.

Which is why some investigators, and some study centers, have good track records when others do not.

When I choose patients for clinical trials, I cast about for seemingly irrelevant information.

Are they married or in a stable relationship? (Women seem to do OK without men, but not vice versa.)

Is there more than one way we can reach them?

Do they have a driving license and a car? How long have they lived where they live?

How do they feel about drug companies, and the FDA, and about clinical studies?

Do they understand that if I am able to give them the study drug, the drug has already been proven unlikely to cause death, cancer, and other bad things?

How much education do they have?

Any of these may not matter in particular, but a clinical investigator needs to know his patients, and needs to be nit-picky about who gets enrolled.

One of the reasons clinical research is so very expensive for companies is that for every patient suited to be in a study, you have to screen or consider, on average, four or more people.

And investigators and clinics must be compensated for their efforts, often arduous, in doing this.

People enroll in studies for different reasons.

For some, they do it to get paid, though not all studies pay volunteers.

In medical school, I lived with a non-medical guy who came home one day and said he’d just signed up to be a patient in a new study, and that he’d get $1000 for being in it.

Did the study require him to do anything?, I asked. Such as have a procedure?

He said he would have to undergo bronchoscopy, in which a thin endoscope would be shoved up his nose and from there into his airways.

I explained this to him, because he said the study site had not. I explained that for some people bronchoscopy is a horrible experience with retching and choking, in addition to the agony of something being threaded up through your nose.

He wasn’t lied to by the study site, but had his mind on that thousand dollars and wasn’t paying attention.

Once a study is underway, some patients rethink whether they actually want to be involved.

Clinical trials are now a serious and international big business.

Thailand may not be the sex, drugs and rock-’n’-roll destination it was 30 years ago, but it still is not first world either.

Drug companies often pursue trials in such places because they may be inexpensive and regulatory approval is easy.

If you have not seen the fine film The Constant Gardener (or read the Le Carre novel), I won’t give away the storyline except to say that it touches on a clinical trial going on among Kenyan AIDS patients who have TB…and things are not as they appear to be.

A tiny company called Atheronova (AHRO) has a drug being investigated for its potential to cause atherosclerotic blockages in arteries to shrink away, potentially the greatest blockbuster drug of all time.

But I hesitate to invest in them because they chose to do phase I studies in Russia.

A concept of informed consent does not exist in Russia. I have taught and consulted in Russia, and if you have spent any time there, you know that business dealings are not always transparent in Putin’s “Great Alternative” to western civilization.

Money can influence the outcome of a study.

I am not accusing Atheronova of such a thing, but an initial clinical trial in Russia causes me concern.

By ITA, drug X cures CG only 60 per cent of the time…quite different from 100 per cent (by PPA).

That may be adequate for drug X to enter phase III, or may not be. It all depends on what the success rate is with any other agent being used to treat CG. If CG is a virus and ibuprofen and chicken soup are the only things to take for it, drug X has a future.

But if there is a drug Y that cleans up CG in 75 per cent of patients who decide to take it, drug X has no future because the clinical trial studying it had problems.

In Biotron’s study of HCV/HIV patients, they recruited 12 patients at a site in Thailand.

Four patients had genotype 1 HCV, classically much harder to clear with interferon and ribavirin.

Eight had genotype 3, easier than genotype 1 to clear, but still quite difficult to eradicate in HIV-coinfected patients.

Worldwide, genotype 1 is far and away the commonest HCV strain, and has usually been the hardest to cure.

Genotype 2 is uncommon but quite easy to cure.

Genotypes 3, 4, 5 and 6 vary in their response to treatment, but are intermediate in curability.

Biotron alludes to 12 patients in its press release, and goes on to state that all treated patients were SVR.

But fellow Gumshoers, that statement in the press release is, at best, sophistry.

Is this outcome really what happened?

It seems not.

They had real problems with this study.

The pool of four patients with genotype 1 proved impossible to analyze.

Some dropped out. Others were highly intolerant of the interferon/ribavirin component of the treatment, and had to be pulled out of the study because of this.

None of these patients had ever previously received interferon or ribavirin (they were “treatment naive”) and severe problems with myalgias, insomnia, nausea, rashes and fevers often hound patients on interferon and ribavirin.

Of the eight genotype 3 patients, two disappeared for no apparent reason.

They no longer showed up.

The six who remained, however, did the full study.

They received BIT225 early in the study at a dose of 300 mg twice daily by mouth, along with PEG-interferon alpha-2b by self-administered subcutaneous injection and ribavirin by mouth.

Doses of the latter two drugs were weight-based.

While the BIT225 was given for 4 weeks, therapy with the other agents continued on thereafter for a standard 44 more weeks.

Most of the six had no detectable HCV RNA by PCR at 12 weeks into the study, and all were virus free at the end of the study.

All remained without virus 12 and 24 weeks following last drug doses. But they started with 12, and finished with six.

By PPA, Biotron had 100 per cent SVR with this study, but only 50 per cent by ITA. 100 per cent makes for a good press release!

But if Biotron aims to publish this data, it can claim only 50 per cent success: they set out to treat 12 and cured six.

Even so, of those six patients who got BIT225 plus standard therapy, my prediction, based on many years of treating HCV, is that at most two of them would have cleared HCV without BIT225.

This would be on the basis of comparison with historical controls, and one flaw in the study is that there was no control arm, no set of patients who just got interferon and ribavirin but not BIT225.

For this data really to matter, Biotron will have to do more studies…with control arms, and in genotype 1 patients, who are harder to cure.

If this dissecting of the data wearies you, I apologize.

Really analyzing biotech stocks is difficult because the devil is in the details.

BIT225 is doing something, and may warrant further study.

More trials will need doing, however, and the cost of doing them will exceed Biotron’s market cap several-fold.

Accomplishing them will like require multiple rounds of raising capital.

But after reading about this trial, my first question was: What happens to patients who have either HCV alone or HIV alone?

Based on pre-clinical studies, BIT225 has some activity against both viruses because it interferes with the viroporins of either.

Has Biotron explored it in “mono-infected” patients? Stick with me a little longer and let’s examine that.

In late 2012, Biotron presented data from another study, again done in Thailand.

This study was of genotype 1 hepatitis C patients who were treatment-naive. They identified 24 patients and divided them into three cohorts.

They wanted to see if BIT225 helped kick out HCV in patients with genotype 1.

Cohort A was a control group of eight patients who got 48 weeks of weight-based PEG-interferon alpha-2b plus ribavirin.

Cohort B was eight patients who got what cohort A got plus BIT225 200 mg twice daily. Patients got interferon, ribavirin, and BIT225 for 28 days, followed by more of the first two drugs for 44 more weeks.

Cohort C was eight patients treated as in cohort B but with 400 mg BIT225 twice daily.

Biotron fared better with this study: all patients in all cohorts stayed on the study except one in cohort C.

For somewhat odd reasons, SVR was assessed not at 12 or 24 weeks, but at 48 weeks. In cohort A, 6 patients (75 per cent by either PPA or ITA) were SVR.

In cohort B, 7 patients of 8 (88 per cent) were SVR.

For both these cohorts the PPA and ITA analysis outcome is the same. And in cohort C, 7 of 7 (100 per cent) patients were, by PPA, SVR.

But one patient dropped out, so 7/8 patients, or 87.5 per cent, were SVR by ITA. Biotron reports “all cured” in this arm, and that is true by PPA, but not by ITA.

What do you think?

Did BIT225 do anything in these patients?

Frankly I am not persuaded.

However, first of all, the success rate in cohort A was very high.

This old standard regimen generally cures perhaps half of all genotype 1 patients at best.

A 75 per cent cure rate is unusual.

This outcome could be concealing a positive effect from BIT225.

But the data betray a bigger concern about BIT225 in these patients.

This drug was only given for 4 weeks at the beginning of the study.

HCV studies generally have an important data point called RVR, rapid virologic response.

RVR patients are those without detectable virus 4 weeks into therapy. If BIT225 were really making a difference in these patients, one would expect patients getting it to be far more likely to have RVR.

But BIT225-treated patients were not likelier to have RVR than control patients based on the data Biotron presented at a liver meeting in 2012.

As I see it, for treating HCV patients who have only HCV, BIT225 thus may have no future.

And neither should it: 75 per cent cure rate without BIT225, but only 88 per cent cure rate with it.

This difference does not rise to statistical significance.

Since BIT225 treated patients did not clear virus early on (the RVR rate was the same in all cohorts), I don’t think the drug is making a difference.

Biotron studied BIT225 in HIV-infected patients who were not yet requiring ART medicines.

They found that monotherapy with BIT225 did not cause a fall in HIV viral load.

They showed that the drug did cause a reduction in HIV within certain white blood cell lines (such as macrophages) isolated from patients.

They hypothesize that BIT225 may have a role in undermining the reservoir effect in which HIV hides in certain cells.

But they are several studies away from proving that.

What this leaves us with is a drug that may have some value in killing HCV in coinfected patients, and may have that activity because it tunes up macrophage function in these patients, function that otherwise was not optimal because of HIV disease.

But meanwhile, success rates at curing HCV in the co-infected using new direct antiviral drugs from Gilead (GILD), Janssen (a unit of JNJ), Bristol- Myers Squibb (BMY) and Abbvie (ABBV) are very high, often better than 95 per cent.

Disclosure: I own shares in Gilead.

With drugs nearing approval for HCV that have such high efficacy, does BIT225 have a future?

Biotron has a novel agent, in a class by itself.

There are no other viable viroporin inhibitors under development that any company has disclosed.

In a defined narrow patient population the drug does something. But in HCV or HIV alone, the drug does not impress.

Despite this, 38 per cent of this company’s shares are held by insiders or Australian strategic investing entities.

But how this company can now design a study, in the context of evolving standards of care for HCV, in which BIT225 can shine...this baffles me.

I see no way out of this maze for Biotron.

That another company would come along and acquire Biotron to get BIT225 seems unlikely because while it has an effect, that effect is either not dramatic, or is now supplanted by and subsumed under better drugs closer to marketing approval.

I predict BIT225 will never see clinical use.

While I may have been labor-intensive in making this point, similar pitfalls lurk for all biotech investing.

These are high-risk enterprises.

Company destinies lie not only with the quality of things they can control but with things utterly beyond what they can do anything about.

Biotron has given the old college try to developing a drug only to find that it shines in a narrow minority of patients now better served with other agents.

While it may have anti-reservoir activity for HIV, other developments in treating HIV, with the likes of companies such as Sangamo (SGMO) and Calimmune (not a public company), are more promising for HIV.

Which leads me sincerely to doubt whether Biotron can even be a going concern in two more years.

Biotron may have made a base hit with its HCV/HIV data, but with its market cap so tiny, it needed a home run to be viable.

Just after I finished the main discussion for this column, Biotron issued a new press release (11 March).

It has planned a new phase II study for BIT225 in HCV mono-infected patients in Thailand.

In this study, patients will be randomized to get either interferon and ribavirin, or interferon, ribavirin plus BIT225, and this time the study drug will be for 12 weeks rather than four.

But already I see problems in study design.

For the trial, they plan to enroll patients with both genotype 1 and 3.

While genotype 3 may be hard to drive out in patients co-infected with HIV, it is easy to cure with drugs in mono-infected patients.

Up to 85 per cent of genotype 3 patients are curable with interferon and ribavirin alone.

So here, as Monty Python would say, Biotron is strafing itself in the metatarsus (shooting itself in the foot) by spending millions to include patients (with genotype 3) in a trial where those patients are not likely to demonstrate benefit from the study drug.

Biotron already found 75 per cent SVR among Thai genotype 1 patients treated with standard of care, and it may be that Thai patients are overall easier to cure than other races.

Is Biotron even aware that they are setting sail for another disappointing trial where results may be doomed to being unimpressive?

If management was smart, they would revise the study protocol now to include only genotype 1 patients, and would take it outside Thailand. I have concerns about Biotron’s management.

Frankly their decisions and data reporting give me a pain in the gulliver.

When contemplating buying stock in a biotech company, there are many things I hope to teach you, and with those, keep you engaged and entertained.

From the example of Biotron, these are some take-home points:

(1) Has the company, in its statements, accounted for all enrolled patients?

Biotron alludes to starting treatment on a certain number of patients, and speaks of good outcomes in certain patients, but in between, they play a shell game with patient numbers.

Some disappear from the final analysis.

Biotron may be inexperienced in presenting data, or may be committing sleight-of-hand.

(2) For phase II studies, was there a control arm?

Not all phase II studies have these, though all phase III studies must by definition.

Biotron has varied on presence of control groups in its phase II’s.

(3) If there was a control arm, was it a legitimate control intervention?

Was that control intervention something that fulfills a “standard of care”?

We are in the twilight of interferon and ribavirin as standard of care for hepatitis C.

(4) Was the outcome of the control intervention what one would expect?

If control patients fared considerably better or worse than patients getting that same intervention are known to have fared, study data may have serious confounding factors.

In one study, Biotron patients given standard of care and not BIT225 had an exceptionally high cure rate, and this could mask BIT225 benefit.

(5) In its statements, is a company presenting data as PPA or as ITA? What you present to shareholders needs to be what you would present to the FDA. If data is being presented as PPA, that needs to be emphasized.

(6) Does the study drug have a niche? Are there other agents that act in the same way?

In the case of BIT225, there is an older drug, amantadine, that was devised before viroporins were discovered and that inhibits viroporins.

But amantadine has been shown to have little activity against HIV and HCV.

(7) And whether there are similar acting agents or not, does it fulfill a clinical need that other agents are not addressing?

Here, no other agents address this molecular target, but given the effectiveness of other drugs acting by other pathways, BIT225 really does not stand poised to improve standard of care for anyone.

(8) When you review company data, does that data say what the company claims it says?

Some Gumshoe readers have expressed an interest in Cytosorbents (CTSO), a company with a device that filters blood in ICU patients to remove cytokines that may be causing multi-organ failure.

The company claims their device helps ICU patients survive.

But according to data very difficult to find on the company website, at 60 days, 39 per cent of people treated with their CytoSorb device died, but only 32 per cent not treated with their device died.

Their device may be making death likelier.

When you invest in biotech, never forget the tagline of the remarkable film Michael Clayton, with George Clooney: “The Truth Can be Adjusted.”

Here’s hoping this case study has been helpful.

Not all my columns will be about why not to invest in a company, and I plan to try to speak about more than one company at a time.

But I find that in reviewing biotechnology companies, at most 10 per cent are ones I want to be in.

When shares surge in value, many of us feel anguish at not being invested in that company, but often with a deeper look at the company, it may be just as well that one not own shares.

Class dismissed, but discussion is welcome.

(I own shares in Benitec and Gilead, mentioned above).