Epicept (EPCT) To Add Additional Arm To Ceplene Trial Print
By Vinny Cassano   
Tuesday, 28 June 2011 02:01
EPCTPositive developments from Epicept Corporation over the past six months have made this a nice rebound story, although the share price hasn't responded just yet, and if the pipeline continues to advance at the current pace while Ceplene catches on in the markets in which its sold, then the future could be bright for this company whose stock is back to trading for under fifty cents.
Ceplene is EpiCept’s maintenance therapy for patients with acute myeloid leukemia (AML) in first remission and is approved in Europe and Israel for use in that regard. 

The path to approval in the United States, however, hasn't been quite so easy.

The FDA provided Epicept with a 'refuse to file' letter some time ago, but then the company developed a course of action that was agreeable with the FDA, which included the completing of a new Phase III trial.  According to that agreement of another trial, Epicept had proposed conducting a two-arm trial "comparing the efficacy of maintenance therapy with Ceplene in conjunction with IL-2 to investigator’s choice, which is often no treatment," according to statements published by the company.

Since that time, it looks like the FDA changed its mind about how the trial should be conducted.

On Monday morning Epicept announced that it had received a written response from the FDA in regards to the previously-filed Special Protocol Assessment (SPA) for the Ceplene trial.  Among the items noted by the FDA, it was revealed that the agency wants another arm added to the trial, one that would "attempt to isolate Ceplene’s effect by including an IL-2 monotherapy arm in the trial protocol."

The tone of the press release reads as if the company is not too happy about the last-minute change of plans set forth by the FDA, and it's noted that Epicept has the right to appeal, but an outsider's opinion would have to say that the request for the additional arm is not that unreasonable.

After all, if Ceplene works as advertised, then the arm in which it's used in conjunction with IL-2 should come out a cut above the arm with just the IL-2 monotherapy treatment.  I'm no doc, but it makes sense to me.

More important for the short term health of the EPCT stock is the reverse split that may now be looming on the horizon.  Investors are hesitant to jump in right before an RS, since share prices tend to decline immediately on the back end of a split.  Investors will also be weary of the lifeline thrown the company by the Nasdaq - something's gotta give in order to keep the stock listed.

Monitor the developments at Epicept.  With an advancing pipeline, this one could be a mid to long term hold.  The potential for future gains make today's prices a nice risk/reward play, in my opinion.

Disclosure:  Long EPCT.


Vinny also authors the popular stock investing blog VFC's Stock House. 

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