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Topotarget is a biopharmaceutical company that is focused on the commercialization of its lead drug candidate, the anti-cancer agent Belinostat. Belinostat belongs to the class of Histone Deacetylase Inhibitors (HDACIs) and has had positive results for the treatment of haematological diseases and solid tumors. The main advantage over other HDACIs is its low toxicity and mild side effects, which allow treatment in large dosages, as well as the option to safely combine Belinostat with other anti-cancer drugs for the treatment of multiple diseases. Belinostat is currently being investigated in more than ten ongoing clinical trials both as monotherapy and in combination with other drugs. Although all of these are clinically interesting, the company outlook at the end of 2012 will almost solely depend on the results of two of these trials.
Belinostat is an investigational drug but could become formally approved as soon as 2013 if it satisfies the Special Protocol Assessment (SPA) by the US Food and Drug Administration (FDA) for the treatment of Peripheral T-Cell Lymphoma (PTCL). Briefly, for approval, the SPA requires Belinostat to show an objective response rate exceeding 20% and, since the results of a preliminary study indicated an overall response rate of approximately 30% and that an independent data monitoring committee recommended the study to continue in early 2011, there is a positive likelihood of success. Topotarget’s partner, Spectrum Pharmaceuticals, plan to submit a new drug application (NDA) to the FDA in 2012 and, because it has fast-track status, Belinostat may be formally approved in H1 2013. Drugs targeting PTCL have a niche market, with global sales estimated to reach US$ 130Mannually. However, it is crucial that the efficacy of Belinostat matches or exceeds that of current medication for this to be realized. Practically, this means that if the overall response rate exceeds 30%, and since it has shown milder side-effects than its competitors, Belinostat could be adopted widely leading to a strong market position.
The PTCL trial is key for a rapid market entry, but greater potential lies within solid tumors. Belinostat is currently being used in a randomized phase II trial together with Carboplatin and Paclitaxel for the treatment of Carcinoma of Unknown Primary (CUP). CUP is a heterogenous disease with no formally approved therapy. The Carboplatin/Paclitaxel combination is routinely used however, the mortality rates are high, indicating a strong medical need (while using the CaP treatment scheme, the median values of progression-free survival (PFS) and overall survival (OS) rarely exceeds 6 and 12 months, respectively). A recent phase II study evaluating a combination of Avastin/Tarceva/Carboplatin/Paclitaxel yielded a record median PFS of 8 months and a median survival time of 12.6 months .For the ongoing phase II study to reach its primary endpoint, the median PFS must be at least 60% longer for patients treated with BelCaP (Belinostat+Carboplatin+Paclitaxel) compared to patients treated with CaP (Carboplatin+Paclitaxel) alone. A rough estimation, based on the longest median PFS recorded for a study utilizing the CaP combination, implies that the median PFS must exceed 10.2 months (6.4*1.6) for the BelCaP arm for this to happen. The release of top-line study data for this trial has been postponed from early H2 2011 to H1 2012 because the target number of patients that fall into progression were not met by the end of November 2011. Given that enrollment was initiated in middle H1 2009 and was completed by the end of 2010 this indicates that progression is slower than expected. Model data based on a constant recruitment rate and the hypothesis that PFS follows an exponential decay function suggest that it is likely that the primary end-point will be met . In contrast to PTCL, CUP is a rather common disease constituting for about 2-4% of all cancer cases. The market for Belinostat for CUP treatment has previously been estimated to reach US$ 500M annually. If the BelCaP combination is successful in this trial, it is estimated that off-label sales, i.e. sales prior formal approval, will contribute to the cash-flow from 2013, provided Belinostat becomes approved for the treatment of PTCL .
For a small-cap company, Topotarget is strongly supported in terms of cash, partnerships and experience. The cash assets are estimated to be roughly DKr 110M at the end of 2011, which is enough to secure the activities into 2013 and significant milestones are to be released by Spectrum during the NDA filing and approval for PTCL. Topotarget has valuable scientific partners in the US-based National Cancer Institute (NCI) and Danish Rigshospitalet whereas the only commercial partner yet is Spectrum Pharmaceuticals. This deal was made public in early 2010 and gives Spectrum full rights to Belinostat in North America and India and has first negotiation rights for China. The potential value of this deal, excluding the double-digit royalty payments and split costs for further trials with Belinostat, is US$ 350M, of which US$ 30M has been paid upfront. Topotarget intends to widen its global partnerships, estimating that these will arrive in H2 2013.
The future for Topotarget depends strongly on how well Belinostat performs in the PTCL and CUP trials. If both these fails the future is, no doubt, bleak, but if the respective endpoints are met Belinostat faces a market valued to a large multiple of the current capitalization value (~ US$ 52M as of December 14 2011). Previous data for the PTCL trial and model data for the CUP trial indicate a fair chance that this will happen. The large discrepancy between the capitalization value and the target market value of Belinostat makes Topotarget a promising investment opportunityfor 2012 however the risks associated with an investment based on the outcome of clinical trials should be considered.
 Hainsworth et al., “Paclitaxel/Carboplatin plus Bevacizumab/Erlotinib in the First-Line
Treatment of Patients with Carcinoma of Unknown Primary Site”, The Oncologist, 2009
 “68 - an important number for the Topotarget investor”, http://www.redeye.se/aktiebloggen/topotarget/68-%E2%80%93-important-number-topotarget-investor
 “Topotarget – Belinostat will be used off-label for CUP in the US”, http://www.redeye.se/aktiebloggen/topotarget/topotarget-%E2%80%93-belinostat-will-be-used-label-cup-us
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