The ExteNET trial enrolled 2,821 patients in 41 countries with early-stage HER2-positive breast cancer who had undergone surgery and adjuvant treatment with trastuzumab. After completion of adjuvant treatment with trastuzumab (Herceptin), patients were randomized to receive extended adjuvant treatment with either neratinib or placebo for a period of one year. Patients were then followed for recurrent disease, ductal carcinoma in situ (DCIS), or death for a period of two years after randomization in the trial.

 

The primary endpoint of the trial was disease-free survival (DFS). The results of the trial demonstrated that treatment with neratinib resulted in a 33-percent improvement in DFS vs. placebo. The hazard ratio was determined to be 0.67, which was statistically significant with a p-value of 0.0046. The secondary endpoint of the trial was DFS including DCIS (DFS-DCIS). The results of the trial demonstrated that treatment with neratinib resulted in a 37-percent improvement in DFS, including DCIS, vs. placebo. The hazard ratio was determined to be 0.63, which was statistically significant with a p-value of 0.0009.

 

Based on these results from the ExteNET study, Puma plans to file for regulatory approval of neratinib in the extended adjuvant setting in the first half of 2015. Full results of the ExteNET trial for PB272 will be presented at a future scientific meeting

 

“We are very pleased with the results of the ExteNET trial with neratinib. This represents the first trial with a HER2-targeted agent that has shown a statistically significant benefit in the extended adjuvant setting, which we believe provides a meaningful point of differentiation for neratinib in the treatment of HER2-positive breast cancer,” said Alan H. Auerbach, CEO and president of Puma. “While the use of trastuzumab in the adjuvant setting has led to a reduction in disease recurrence in patients with early stage HER2-positive breast cancer, there remains an unmet clinical need for further improvement in outcome in order to attempt to further reduce this risk of recurrence. The results of the ExteNET study demonstrate that we may be able to provide this type of improvement with neratinib to further help the patients with this disease.”

 

But that news of positive Phase 3 data, which gave a boost to Puma's stock price—tripling the price in after-hours trading following the July 22 announcement—came with word from Puma that it had amended its licensing agreement with Pfizer for PB272, which is also being eyed for treatment of non-small cell lung cancer as well as breast cancer and other solid tumors that have a HER2 mutation.

 

When Puma licensed PB272 from Pfizer, a number of ongoing clinical trials (legacy clinical trials) that had been previously initiated by Pfizer were transferred to Puma. The original license agreement set a limit on the amount of external expenses that Puma would incur in completing these legacy clinical trials. Puma reached this limit in the fourth quarter of 2012. The original license agreement also provided that Pfizer would be responsible for all expenses for these ongoing legacy trials above the pre-determined limit until the trials were completed.

 

The amendment to the license agreement provides that Puma will now be solely responsible for the expenses associated with the ongoing legacy clinical trials. Puma anticipates that this will result in an increase in research and development expenses, which will total approximately $30 million. Puma further anticipates that a significant percentage of this approximately $30 million will occur in 2014 and will decrease over time until the trials are completed.

 

In addition, according to the terms of the original license agreement, upon commercialization of neratinib, Puma is obligated to pay Pfizer incremental annual royalties ranging between 10 to 20 percent of net sales of neratinib. Under the terms of the amendment to the license agreement, upon commercialization of neratinib, Puma will be obligated to pay Pfizer annual royalties on net sales of neratinib at a fixed rate in the low- to mid- teens.

 

Whether or not Puma actually sees benefit in Pfizer being out of the funding picture or is simply trying to put a positive face on bad news, Auerbach said, “We are pleased to enter into this amendment to the licensing agreement for neratinib. By assuming responsibility for the expenses associated with the ongoing legacy clinical trials, and by fixing the royalty rate for the drug at a reduced rate, we believe that we have significantly improved the potential value of the drug.”