Lots of Uncertainty in Upcoming GLYC Sickle Cell Readout

GLYC has what is likely to be a binary event reading out later this year, likely in the next 45 days, with the phase 3 readout of its partnered-out drug rivipansel for the treatment of vaso-occlusive crises (VOCs) in patients with sickle cell disease (SCD). We find it difficult to predict success or failure for this readout, but we feel that odds favor a negative move in the stock price when this one reads out:

-In favor of a positive primary endpoint readout - Results of a similar but much smaller phase 2 trial of Rivipansel showed an efficacy signal across multiple endpoints; there are many more patients in the Ph3 trial (350 from 76); the mechanism of action for rivipansel (selectin inhibition for treating painful VOCs suffered by sickle cell patients) has been partially validated by a Novartis drug, SEG101 (see Press Release), in a different but related indication (prevention of VOCs vs. treatment of VOCs) and one of our Amp Core companies, GBT, licensed a selectin inhibitor with plans for a pivotal study (Press Release); and there was some variability in dose and severity of disease in early vs. late patients in the phase 2 trial that likely added variability to the results.

-Against a positive primary endpoint readout - the phase 2 trial did not reach statistical significance for the endpoint most similar to the primary phase 3 endpoint (see graphic below from Table 2 of Ph2 publication); and in fact did not reach significance in any endpoint except 1 secondary related to opioid use; and there were 153 sites for this Phase 3 vs. 17 sites for the phase 2, which general adds variability which makes it more difficult to show statistical significance even when there is a positive efficacy signal.

Table 1 from phase 2 publication.

In sum, we find it difficult to predict success in a phase 3 even with a positive phase 2 trial in many cases where the phase 2 trial was much smaller, at fewer sites, and did not show strong significance. Therefore, here where there wasn't significance in the phase 2, its hard to give this a high probability of success. Nevertheless, we have a small position in GLYC in our spread-the-risk fund, but will likely look to execute some bearish options spreads, or if possible, some options plays that give positive returns if there is a significant move in either direction, in our more focused fund where we use options to hedge our positions, because of the difficulty in predicting the outcome in this fairly binary event for GLYC. Our current predictions are as follows: 25% chance +20% to +50% stock move 75% chance -10% to -40% stock move

Despite our moderately negative sentiment on the event, selectin inhibitors like rivipansel hold excellent promise for preventing and treating VOCs in SCD. Unfortunately, based on GLYC's phase 2 results for rivipansel, it appears tricky to get trial designs correct to deal with the high variability in results.

#GLYC #AmpFree #SCD #VOC #Selectins