One day after bad news about one promising cancer drug sent EntreMed Inc.'s shares tumbling, the Rockville biotechnology company's stock roared back yesterday after good news about another cancer drug.
Shares doubled, rising $12.8125 to $25.6875, after government researchers said they had reproduced Dr. Judah Folkman's use of endostatin to shrink lung tumors in mice. On Wednesday, the company's shares fell $11.625, or 47 percent, after Bristol-Myers Squibb Co. pulled out of an agreement with EntreMed to develop angiostatin.
EntreMed holds the rights to develop both angiostatin and endostatin.
The drugs became the focus of national attention in last May, after Folkman told the New York Times that he had combined angiostatin and endostatin to eradicate tumors in laboratory mice.
Mary Sundeen, the company's vice president for research, said the stock rose yesterday in response to the endostatin announcement and growing confidence in the company's ability to develop angiostatin without Bristol-Myers Squibb.
"I've had 33 calls about endostatin and 133 calls about Bristol-Myers Squibb and angiostatin," she said.
Researchers say the drugs, which can be used alone or together, shrink tumors by starving them of their blood supply.
The National Cancer Institute said yesterday that staff members performing experiments on endostatin in Folkman's Boston laboratory produced results "consistent with the previous Folkman experiments, showing striking inhibition of mouse lung tumors.
After yesterday's trading of 8.2 million shares -- 26 times the average daily volume -- shares in EntreMed closed higher than they did Tuesday, $24.50, before the stock's steep drop.
NCI researchers initially had problems duplicating Folkman's results, but the drug gained credibility last month when the journal Cancer Research reported that Dr. Vikas A. Sukhatme, a Boston researcher, had confirmed Folkman's findings that endostatin halted a specific type of tumor growth in mice.
In the announcement yesterday, the cancer institute said researchers from its staff and from Folkman's group will continue joint experiments at the institute's facilities to confirm the positive results.
In addition, EntreMed has begun full-scale toxicology studies with human endostatin, with plans for an investigative application this summer and human trials shortly thereafter. And the National Cancer Institute solicited proposals last week for two initial trials of human endostatin.
Eric Ende, a Lehman Brothers analyst, said he was surprised by yesterday's rise in EntreMed's stock, which he attributed to the news about endostatin.
"There's nothing overly new here except that endostatin has been validated by the NCI," he said. "This is really early stuff. I don't know why people are getting so excited."
Sundeen said she believes the stock's rise resulted largely from renewed confidence in the company's ability to develop angiostatin.
She said investors had interpreted a modification in an agreement with Bristol-Myers Squibb Wednesday as a sign that angiostatin had lost its promise. Under the modification, EntreMed assumes responsibility for developing angiostatin from Bristol-Myers Squibb.
Bristol-Myers Squibb had trouble producing reliable batches of the molecule using mammal cells. EntreMed said it has had great success using yeast.
Sundeen said the company will proceed with plans to submit a drug application to government regulators this year and begin human trials shortly thereafter.
"Now that people understand that we're fully capable and ready to move forward, that's boosted confidence and made people feel comfortable," she said.
Pub Date: 2/12/99