Opthea's Eye Disease Drug Fails to Match Eylea in Phase 3 Trial, Jeopardizing Company's Future

Opthea, an Australian biotech company, faced a significant setback as its eye disease drug candidate sozinibercept failed to outperform Regeneron's Eylea in a crucial phase 3 trial. This unexpected outcome has left the company reassessing its future and exploring options to maintain financial stability.

Trial Results and Implications

The phase 3 COAST trial evaluated sozinibercept, an inhibitor of vascular endothelial growth factors (VEGFs) C and D, in combination with Eylea for the treatment of wet age-related macular degeneration (AMD). The study compared two dosing regimens of sozinibercept (2 mg every four or eight weeks) plus Eylea against Eylea monotherapy.

Results showed that patients receiving the combination therapy experienced mean changes in best corrected visual acuity at Week 52 of 13.5 and 12.8 letters for the four-week and eight-week dosing schedules, respectively. However, patients treated with Eylea alone demonstrated a slightly higher improvement of 13.7 letters, failing to meet the trial's primary endpoint.

Opthea reported that there was "no numerical difference observed in the key secondary endpoints," further dampening hopes for the drug's potential.

Financial Uncertainty and Strategic Decisions

The trial's disappointing outcome has cast doubt on Opthea's financial future. With $113.8 million in cash reserves as of February's end, the company acknowledged "material uncertainty as to Opthea's ability to continue as a going concern."

In response to the setback, Opthea has initiated discussions with investors to explore options for avoiding debt and additional charges. The company is also evaluating the future of both the COAST trial and the ongoing phase 3 Shore trial, which is assessing sozinibercept in combination with Novartis' Lucentis.

Trading of Opthea's stock has been halted on both the Australian and Nasdaq exchanges while the company formulates a plan moving forward.

Previous Optimism and Market Positioning

The phase 3 failure marks a dramatic shift in Opthea's prospects. Just a month prior, the company had been preparing for a potential commercial launch of sozinibercept in the wet AMD market. This confidence was built on positive results from earlier studies, including a phase 2 trial where sozinibercept outperformed Lucentis in wet AMD patients.

Opthea's market position had been bolstered by a successful $128 million IPO on the Nasdaq in 2020, reflecting investor enthusiasm for sozinibercept's potential. The company had also observed "evidence of improved clinical outcomes" in a phase 1b/2a study combining sozinibercept with Eylea in patients with treatment-refractory diabetic macular edema.

As Opthea navigates this challenging period, the company's next steps and the future of sozinibercept remain uncertain, potentially reshaping the landscape of AMD treatment development.