Pfizer Stops Developing Coley Cancer Drug

Pfizer found that a drug designed to harness the immune system to fight cancer was not effective in treating non-small-cell lung cancer. It is stopping further studies of the medicine.

The news is a setback for Pfizer as it aims to build a large arsenal of anti-cancer medicines to help it grow earnings before big sellers like Lipitor, the top-selling medicine in the world, lose patent protection in coming years. It is potentially a disaster for Pfizer's partner, Coley Pharmaceutical of Wellesley, Mass., which invented the medicine.

Coley's technology takes aim at toll-like receptors (TLRs), detectors on immune system cells that pick up invaders and bad actors in the body. Coley's drug was supposed to cause immune system cells to attack cancer cells by turning on TLRs.

Pfizer licensed the medicine, then known as Promune, in 2005 for $50 million; future payments to Coley could have totaled $455 million. But recently an independent committee monitoring Pfizer's two big studies of the drug, know known as PF-3512676, took a scheduled look at the data. Although the drug wasn't doing harm, there was little chance it would show a benefit, so that trial was stopped. Pfizer is also stopping two midstage studies of the same medicine, also in lung cancer.

The apparent failure illustrates the problems for drug firms like Pfizer as they spend millions to license drugs developed by other companies. Sometimes data from studies conducted by small biotechs don't answer all the questions of the company making the bet. It also illustrates how even as some "targeted" approaches to cancer therapy show promise, researchers are still facing dead ends.

Pfizer is still conducting tests of the drug in breast cancer, colorectal cancer, skin cancer and in lung cancer in combination with Genentech's Tarceva, according to Ray Kerins, a Pfizer spokesman. Brian McCarthy of Merriman Curhan Ford, an analyst who covers the stock, said in an interview that Coley shares may recover as investors realize there is still some potential for the drug. "The question that remains for investors is what does remain," McCarthy says. "We will be waiting for that to be defined."

Coley did not return requests for comment, but the company is holding a conference call Wednesday afternoon. Its stock dropped more than 60% to $3.50.