EntreMed shares surge 154% on drug news

Article reports Panzem helpful against cancers

April 23, 2003|By Andrea K. Walker | Andrea K. Walker,SUN STAFF

Shares of EntreMed Inc. stock leaped 154.6 percent yesterday after the Rockville company announced new findings on its anti-cancer drug Panzem.

The company's stock closed at $2.75, up $1.67.

The jump in share price was prompted by preclinical findings printed in this month's issue of Cancer Cell that said Panzem helps to greatly reduce microtubules and hypoxia inducible factors (HIFs) in cells. High levels of HIFs are found in 70 percent of human cancers, including those of the breast, prostate, brain, lung, head and neck.

The drug also inhibits production of microtubules, a portion of a cell that is active in cell division. Disrupting the production of microtubules directly affects the production of HIFs.

Panzem is a pill that is designed to work by blocking the formation of tiny blood vessels that feed growths, including cancerous tumors.

The study was co-authored by EntreMed scientists and scientists from the Emory University School of Medicine, Winship Cancer Institute.

The jump in stock price was a dose of good news for EntreMed, which has had to cut costs over the past year.

On the brink of running out of cash, the company cut 60 jobs, or nearly half of its staff, last year. EntreMed also sold rights to its thalidomide-related drug to Celgene Corp. for $27 million.

The company also shifted its business strategy to focus on small-molecule drugs, such as Panzem, that are cheaper to make and less complicated to administer than those with proteins, which are large, complex molecules that are generally injected.

In a statement, Neil Campbell, EntreMed president and chief operating officer, said the findings are further evidence that Panzem has a promising future.

"We will continue to develop Panzem as a potential therapeutic for oncology and look to expand its application into other HIF-related diseases, such as arthritis and ischemic disorders," Campbell said.

One analyst said he expects the findings to have little long-term impact on EntreMed's bottom line.

"When you're dealing with a cancer drug, you always want to understand the drug's mechanism of action," said Alan Auerbach, an analyst with Wells Fargo Securities. "I don't see any major positive impact financially for them."

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