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Threshold Pharmaceuticals Rises on Hope for Cancer Drug

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Partner Merck of Germany is advancing the biotech company's experimental therapy for pancreatic cancer into a large, late-stage human study. The milestone earns Threshold $30 million.

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Shares of Threshold Pharmaceuticals (NASDAQ:THLD) are rising after the company's development partner, Merck KGaA (PINK:MKGAY) of Germany, said it is advancing a drug for pancreatic cancer into a large late-stage human study.

Merck sends Threshold a $30 million milestone payment as part of an agreement announced in February of last year. The drug, TH-302, is being tested with an older chemotherapy gemcitabine to treat advanced pancreatic cancer, a disease that leaves patients little hope for surviving. The partnership with Merck is potentially worth $525 million to Threshold if the product is ever approved and meets sales goals. Threshold has the right to co-market the drug in the US if the medicine wins government approval.

Shares of Threshold rose 4% to $5.12 midday Friday after rising by double digits earlier in the day. Shares of the company are up almost 250% over the past 12 months.

Merck expects to enroll 660 patients in the trial and the primary goal of the study is to show overall survival. The study's design was approved by the US Food and Drug Administration under a so-called special protocol assessment.

The announcement by Merck and Threshold comes just three days after Celgene (NASDAQ:CELG) said a late-stage study of its drug Abraxane showed an improvement in overall survival. Abraxane, which is also being tested with gemcitabine, helped patients live longer than those only treated with the older chemo. About 35% of the Abraxane patients survived after one year vs. 22% of those only given gemcitabine, the current standard of care for pancreatic cancer. Abraxane is already approved for breast and lung cancer.

Some investors weren't impressed with the recent Abraxane study results, leading to a decline in Celgene's stock earlier this week. That should be seen as encouraging for investors in Threshold, Stifel Nicolaus analyst Joel Sendek says.

"A robust Abraxane result could have impeded enrollment in the (Threshold drug) trial, but we view the Abraxane results as just on the edge of what is considered a clinically meaningful benefit," the analysts says in a note Friday.

Pancreatic cancer has been a difficult disease for developing new treatments. Amgen (NASDAQ:AMGN) ended a study of a drug last August after research advisers said it didn't appear that the treatment worked.

There is no cure for pancreatic cancer. If the cancer spreads beyond the pancreas, average survival is less than a year, according to US health officials. About 95% of patients die within five years. Threshold says about 277,000 cases of pancreatic cancer are diagnosed worldwide every year, making up more than 2% of all cancers. The death toll is about 266,000 a year, the company says.

Both the Threshold and Celgene drugs are being studied to treat metastatic pancreatic adenocarcinoma, the most common form of pancreatic cancer.

Twitter: @brettchase

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