Geron Corporation’s (GERN - Analyst Report) shares plunged 61.6% on news that the FDA has placed a full clinical hold on the company’s only pipeline candidate, imetelstat.
What is a Clinical Hold?
A clinical hold is an order issued by the FDA under which the sponsor of the study is asked to delay a proposed trial or suspend an ongoing trial. Geron had submitted an Investigational New Drug (IND) application for imetelstat to the FDA. However, the FDA issued a verbal notice placing the company’s IND application for imetelstat on hold. So, not only will the company not be able to initiate a study on imetelstat, the notice will also affect currently ongoing studies on imetelstat which have been sponsored by Geron.
Currently ongoing studies include a phase II study in essential thrombocythemia (ET) or polycythemia vera (PV) and another phase II study in multiple myeloma. Moreover, Geron’s plans of conducting a phase II study in myelofibrosis, scheduled to commence in the first half of this year, will most likely get delayed due to the clinical hold. Chances remain that investigator-sponsored studies will also be placed on clinical hold.
Cause for Concern
Although Geron is yet to receive a written notice regarding the clinical hold, the company said that the FDA is concerned about the occurrence of persistent low-grade liver function test (LFT) abnormalities in the phase II study for ET/PV as well as the potential risk of chronic liver injury following long-term exposure to imetelstat. The agency is concerned about the possibility of reversing these LFT abnormalities.
The full clinical hold on imetelstat is a major setback for Geron. Geron has suffered imetelstat-related setbacks earlier too – the company had to drop its plans to develop the candidate for breast cancer and non-small cell lung cancer. With the FDA voicing concerns about safety, we currently have low visibility on when imetelstat-based studies can resume/commence.
Even if imetelstat studies continue, concerns about LFT abnormalities could limit the commercial potential of the candidate and restrict its long-term usage.
Geron is a Zacks Rank #4 (Sell) stock. Better-ranked stocks in the biotech sector include Gilead Sciences Inc. (GILD - Analyst Report) , Alkermes plc (ALKS - Analyst Report) and Alexion Pharmaceuticals, Inc. (ALXN - Analyst Report) with all three being Zacks Rank #1 (Strong Buy) stocks.