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Oncothyreon Starts Study on ONT-380

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Oncothyreon Inc (ONTY) recently started a phase I investigator sponsored study on its candidate, ONT-380 (also known as ARRY-380). In the study, ONT-380 plus Roche’s (RHHBY) Herceptin will be evaluated for patients with brain metastases due to HER2+ breast cancer. Dana-Farber Cancer Institute, based in Boston, MA will sponsor the study.

The dose-escalation study will evaluate about 50 patients. The primary objective of the study is to ascertain the maximum tolerated dose and a suitable phase II dose of ONT-380 combined with Herceptin in patients with HER2+ breast cancer and central nervous system (CNS) metastases. CNS objective response rate, progression-free survival and overall survival are the secondary endpoints of the study.

The study will be carried out with two distinct doses, either once-daily or twice-daily, combined with the standard dosage of Herceptin.

In May 2013, Oncothyreon entered into a collaboration agreement with Array BioPharma, Inc. (ARRY) to develop and commercialize the candidate.

Array is expected to receive an upfront fee of $10 million on the initiation of the collaboration. As per the terms of the agreement, Oncothyreon will be responsible for the development of ONT-380 in multiple proof-of-concept studies in patients suffering from metastatic breast cancer, including patients having brain metastases. These studies will evaluate the candidate in combination with other approved breast cancer drugs.

Following the completion of the agreement, Array and Oncothyreon plan to jointly conduct a phase III program on the candidate, supported by the proof-of-concept studies. Both Array and Oncothyreon will have the right to stop further development and commercialization in lieu of royalty payments.

While Array will be responsible for the worldwide commercialization of the candidate, Oncothyreon will enjoy co-promotion rights to the candidate in the US. The companies will be, however, sharing the commercialization costs and profit equally in the US. Oncothyreon is entitled to receive double-digit royalty on net sales in ex-U.S. markets. Moreover, the companies will share evenly any proceeds from sublicense of the marketing rights.

Oncothyreon carries a Zacks Rank #3 (Hold). Currently, companies which look attractive include Gilead Sciences Inc. (GILD) with a Zacks Rank #1 (Strong Buy).

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