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Phase III Clinical Trial Data Catalyst For An Orphan Drug: A Case Study

January 28, 2013

Biotechnology stock movements are affected at various phases of the US FDA’s drug approval process.  Big stock moves, either up or down, are associated with several catalysts :

–   Releases of trial data

–   Briefing documents prior to Advisory Committee meetings (AdComs)

–   AdComs themselves

–   Prescription Drug User Fee Act (PDUFA) dates.

One of the last catalysts before a final FDA decision, comes from a drug’s Phase III clinical trial data. Positive trial results can result in shares popping. There is also the reverse situation of failed clinical trial results causing shares to sink. Thus, late Phase clinical trials is one of the most critical steps of the orphan drug development life cycle. This is the critical time where demands for data on the drug’s safety and efficacy, comparisons to competitors, and other factors are important.

Celsion Corporation’s Phase III HEAT Study data of orphan drug ThermoDox for primary liver cancer is due for release in the next few days. The study evaluates Celsion’s drug for Hepatocellular Carcinoma (HCC) using encapsulated doxorubicin and Radio Frequency Ablation (RFA) for delivering the drug to the targeted treatment site – the liver. According to, shares of Celsion gained 350% in 2012, but is down 5% so far in 2013. Within a few days, the stock will either “rise 150% to reflect the future sales of a product that could return peak sales of $1 billion or it will drop 80% after the data is announced”. A lot is riding on the Phase III HEAT data results for determining this company’s future.

ThermoDox has received Fast Track and Priority Review designations from the FDA. The company has reached a 505b(2) agreement with the FDA, establishing a potential for an Accelerated Regulatory review process. ThermoDox has orphan drug designations for HCC in the US and Europe.

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