Arena Ready For Etrasimod Phase III Face-Off With Celgene's Ozanimod In UC

With significant Phase II results in ulcerative colitis, Arena is planning a Phase III program for its selective S1P receptor modulator etrasimod – a drug that it thinks can best Celgene's S1P-targeting therapy ozanimod on safety and possibly efficacy.

Arena Pharmaceuticals Inc.'s S1P receptor modulator etrasimod is ready to move into Phase III after the company reported much-anticipated positive results from the Phase II OASIS clinical trial in ulcerative colitis – an indication where Celgene Corp.'s competing drug ozanimod already is in Phase III.

San Diego-based Arena, continuing to advance its in-house programs after giving up hope of commercial success for obesity drug Belviq (lorcaserin), believes that its selective S1P modulator has the potential to be a best-in-class drug (see video sidebar).

The company is making a big bet on the selective activity of etrasimod – which targets SIP receptor subtypes 1, 4 and 5, but not 2 and 3 – to avoid cardiovascular safety issues. While Phase II trials for Arena's and Celgene's drugs have differences in their designs, it appears that etrasimod may be safer and potentially more effective in ulcerative colitis (UC).

Based on the release of etrasimod Phase II data late on March 19, Arena's stock made up some of the ground it lost last week, rising 24.8% in after-hours trading to $38.55 per share. The company's stock recently fell 23.2% from $40.20 on March 12 to $30.89 when the market closed on March 19, because it hadn't reported the mid-stage ulcerative colitis results, which were expected in the first quarter of 2018.

Investors finally got what they were waiting for with 12 days left in the quarter when Arena reported that the highest dose of etrasimod tested in the OASIS trial met all of the primary and second endpoints of the Phase II ulcerative colitis study with statistical significance. The company shared top-line results and expects to report more detailed analyses at a future medical meeting.

Arena also intends to share details of its Phase III trial design in ulcerative colitis and its Phase II study plans in Crohn's disease later this year, President and CEO Amit Munshi said in an interview with Scrip.

"We are working toward an end of Phase II meeting with the FDA," Munshi said. "We're excited to share the data with the regulatory authorities in the US and Europe. In the next few weeks and months, we'll be able to provide more guidance on [our Phase III and Crohn's disease plans]."

Higher Dose Most Significant

Arena said patients treated with etrasimod 2 mg daily had a 0.99-point improvement compared with placebo in the three-component Mayo Clinic Score – measuring stool frequency, rectal bleeding and endoscopy findings with scores ranging from 0 to 9 – at week 12, which was statistically significant (reduction of 2.49 points versus 1.5 points; p=0.009). Patients treated with 1 mg once-daily had a 0.43-point improvement versus placebo, which was not statistically significant (p=0.146).

"What's very pleasing for us to see from a scientific standpoint is a clear dose response," Munshi said.

The company also reported that clinical remission as defined by the three-component Mayo Clinic Score was achieved by 33% in the etrasimod 2 mg cohort versus 8.1% for placebo (p<0.001). Remission according to the four-component Total Mayo Clinic Score was achieved by 24.5% treated with etrasimod 2 mg and 6% in the placebo group (p=0.004).

Munshi said the "robust" remission data and mucosal healing observed via endoscopy were especially intriguing, because "those would be the things you look for in a Phase III trial … it puts us in a very strong position heading into Phase III."

Arena described etrasimod as well tolerated with a serious adverse event (SAE) rate that was lower than in the placebo cohort. SAEs were reported for 0% of patients treated with 2 mg daily, for 5.8% of those who were given 1 mg daily and for 11.1% who received a placebo.

The company also reported that significantly more patients in the etrasimod 2 mg group achieved endoscopic improvement – otherwise known as mucosal healing – compared with placebo (41.8% versus 17.8%; p=0.003).

Arena said impacts on heart rate and atrioventricular (AV) conduction were low throughout the OASIS study with no patients discontinuing treatment due to bradycardia or AV block. There was one observation of transient first degree AV and one transient second degree AV, but both were observed in the first few hours after the first dose was administered and resolved within a few hours. There were no reports of macular edema and no abnormal liver function or pulmonary function test results. 

"We have long talked about the potential best-in-class safety profile," Munshi said, noting that the Phase II results "validates our assumptions" that etrasimod is a safer compound than other S1P modulators that "allows us to think much more broadly about where we want to go long term."

Remission Rate Better Than Ozanimod?

It's difficult to compare etrasimod and ozanimod directly, since Arena's endpoints were assessed at 12 weeks and Celgene's endpoints were assessed initially at eight weeks. However, remission rates were important to analysts and investors, and it appears that etrasimod may have performed better than ozanimod in this regard.

"The study was not powered for remission, so to see a very robust effect on remission suggests that we got the dose correct at the 2 mg dose and that the drug is active in the way we had envisioned," Munshi said.

Leerink analyst Joseph Schwartz explained in a March 19 note prior to Arena's Phase II OASIS data release that investors have been focused on remission, safety and T-lymphocyte reductions. Schwartz pointed out that ozanimod showed 14%-16% clinical remission rates versus 6% for placebo at eight weeks in Celgene's Phase II TOUCHSTONE study in ulcerative colitis. That means that "the ballpark of a 10%-15% improvement over placebo appears to be the expected range among investors," he wrote.

At 33% versus 8.1%, the remission rate Arena reported later on March 19 is almost 25% better than the remission rate for placebo.

Remission is an important endpoint because it's likely to be required for approval. The co-primary endpoints for Celgene's Phase III TRUE NORTH study of ozanimod in ulcerative colitis are remission as assessed by Mayo component subscores at week 10 and at week 52. Data from TRUE NORTH are expected to be reported in the fourth quarter of this year followed by a supplemental biologic license application (sBLA) submission to the US FDA in the first half of 2019.

Celgene had a BLA pending with the FDA for ozanimod in multiple sclerosis – an indication Arena does not intend to pursue with etrasimod – but the company received a refuse-to-file (RTF) letter late last month. The FDA issued the RTF letter because nonclinical and clinical pharmacology data in the BLA were determined to be insufficient to permit a complete review.

Celgene indicated that the holdup does not have to do with the core safety and efficacy data supporting its BLA in multiple sclerosis (MS), but safety is a concern for drugs in this class. The first approved S1P modulator was Novartis AG's Gilenya (fingolimod), which is not a selective modulator and is approved for MS with warnings about cardiovascular and liver safety. (Also see "Celgene's Positive Ozanimod Data Puts Focus On MS Commercialization" - Scrip, 22 May, 2017.)

"As we looked at our application in its totality, with all the clinical efficacy and safety data, we felt that we had sufficient information to allow FDA to accept the application for filing. Clearly there are some additional points that they would like us to address and we're in the process of addressing that," Celgene Chief Medical Officer and Head of Regulatory Affairs Jay Backstrom said during the company's Feb. 27 conference call to address the RTF letter.

Leerink's Schwartz noted in his report ahead of Arena's OASIS data announcement that "with ozanimod's effects on bradycardia (and the RTF letter from the FDA), investors are unlikely to be lenient on an adverse safety profile for etrasimod."

With Good Safety Signals, Is Higher Dose Possible?

Asked if Arena has considered testing a higher dose of etrasimod, since the 2 mg dose did not appear to have any cardiovascular or other safety flags in the Phase II OASIS study, Munshi said the 3 mg dose tested in Phase I did not appear to offer any better efficacy than the 2 mg dose.

"In our Phase I study that we did, we didn't see a dramatically improved lymphocyte reduction in the 3 mg versus 2 mg. It's unclear whether 3 mg would actually drive a clear clinical benefit over 2 mg," Munshi said. The 2 mg dose "had a very clear safety profile and that's held up in Phase II, so as far as we're concerned we found the dose that gives us the right safety profile and clinical benefit or clinical efficacy that's as good or potentially better than other compounds in the category."

He noted that S1P modulation also appears to be safer than JAK inhibition, which suppresses the immune system and can lead to infections. Pfizer Inc. is looking to have the first oral therapy approved for ulcerative colitis with its JAK inhibitor Xeljanz (tofacitinib), which recently received a unanimous endorsement from an FDA advisory committee. (Also see "Xeljanz's UC Indication On Track With Higher Doses After Unanimous Advisory Committee Votes" - Pink Sheet, 8 Mar, 2018.)

Arena notes that in the S1P modulator class, selective binding with S1P receptor subtype 1 appears to keep certain activated lymphocytes from migrating to sites of inflammation. Selective inhibition of overactive lymphocytes allows other lymphocytes to remain in circulation and continue immune surveillance that can prevent infections.

"Etrasimod has already demonstrated the ability to lower lymphocytes [in Phase I] in healthy volunteers after 21 days of treatment by a mean of ~69% at 2 mg," Life Sci Capital's Patrick Dolezal said in a March 15 note. "For context, ozanimod reduced lymphocytes by a mean of 49% after eight weeks of treatment in UC patients, which translated into Phase II success on the primary endpoint of clinical remission (p=0.048)."

Munshi noted in an interview with Scrip earlier this year that while S1P receptor modulation could be used to treat more than 80 autoimmune diseases, the company's etrasimod development program is focused on autoimmune gastrointestinal and liver diseases. Arena is also testing the drug in Phase II studies in pyoderma gangrenosum (PG) and primary biliary cholangitis (PBC).

"Our market research suggests that [UC] patients prefer once-a-day oral over the injectables – over the biologics with adverse event profiles – [and] over integrin infusions. If you have a choice of a once-a-day oral that was safe and effective, it would garner substantial market share," Munshi said, referring to monoclonal antibodies approved for ulcerative colitis, such as AbbVie Inc.'s blockbuster TNF inhibitor Humira (adalimumab) and Takeda Pharmaceutical Co. Ltd.'s Entyvio (vedolizumab).

Other Data Later This Year

Arena's clinical pipeline also includes the mid-stage ralinepag for pulmonary arterial hypertension, which the company hopes to move into Phase III later this year following positive Phase II results reported in July. (Also see "Arena Rises, But Raises Questions With Phase II Ralinepag Data In PAH" - Scrip, 11 Jul, 2017.)

Arena also has APD371, a cannabinoid 2 receptor (CB2) agonist, which is in Phase II for the treatment of pain associated with Crohn’s disease with results expected in the second quarter of 2018.