Kazia Therapeutics Ltd (ASX:KZA, NASDAQ:KZIA) has maintained a speculative buy rating from market researchers Bell Potter, following positive Phase II clinical data from a study of paxalisib in newly diagnosed, unmethylated glioblastoma.
The clinical trial involved 30 patients with newly diagnosed glioblastoma – an aggressive type of brain or spinal cancer with average survival of only 12-18 months – with results indicating a median overall survival rate of 15.7 months and a median progression-free survival rate of 8.4 months.
These results compare favourably to historical survival rates of 12.7 months and progression-free survival rates of 5.3 months when treated using glioblastoma standard-of-care temozolomide.
Interim data from November 2020 reported a median overall survival of 17.4 months, indicating the last few patients underperformed the earlier patients, but the treatment maintained a 3-month survival benefit.
This is considered significant due to a lack of new treatments for glioblastoma over the last few years, but cannot be compared to relative performance as the study did not include a control arm.
The main side effects experienced during paxalisib treatment were hyperglycaemia, mouth ulcers and skin rashes, all of which are considered manageable symptoms.
Kazia Therapeutics is enrolling more than 200 patients in a randomised control trial, based at over two dozen sites that are actively recruiting patients, with results scheduled for calendar year 2023.
Due to the success of its Phase II trial, paxalisib has also been selected by the international, physician-led GBM AGILE trial. Established by a network of 130 leading experts in glioblastoma, the GBM AGILE trial is tailored to streamline the discovery of treatments.
Importantly for Kazia, the trial is intended to serve as the pivotal study for paxalisib in multiple markets, including the US, EU, and China.
Bell Potter valuation
Speculative Buy, target price of A$2.40.
“The next catalyst for the stock will be the first readouts from investigator-led studies underway in the US - due in early 2022.
“Cash at September 30 was A$19.6 million which is expected to provide about 12 months working capital.
“There are no changes to earnings in the forecast period and we maintain our Buy (Speculative) recommendation.
“Valuation is reduced to A$2.40 (from A$2.50) reflecting a small decrease in median overall survival in the headline data.”
About Kazia Therapeutics
Kazia Therapeutics is an innovative oncology-focused biotechnology company based in Sydney.
The company’s product pipeline includes two clinical-stage drug development candidates and Kazia is also working to develop therapies across a range of oncology indications.
Kazia’s lead program is paxalisib (formerly GDC-0084), a small molecule inhibitor of the PI3K/AK/mTOR pathway, which is being developed to treat glioblastoma, the most common and aggressive form of primary brain cancer in adults.