Geron to Discontinue Development of GRN1005; to Cut 64 Full-Time Positions

Geron Corporation

today announced that the company has discontinued development of GRN1005, its peptide-drug conjugate designed to treat cancers in the brain. Going forward, the company will focus on the development of imetelstat, its telomerase inhibitor, in hematologic myeloid malignancies and in patients with solid tumors that have short telomeres. The company also announced a restructuring to reduce its workforce from 107 positions to 64 full-time positions, and to reduce its annual cash operating expenses from approximately $65 million in 2012 to approximately $33 million in 2013, which includes non-recurring costs of approximately $3 million associated with the restructuring and approximately $3 million for the discontinuation of clinical trials. The company expects to end 2012 with approximately $90 million in cash and investments. Rationale for Discontinuing GRN1005 The decision to discontinue development of GRN1005 was made after the company completed a planned interim analysis for futility for GRABM-B, the company's Phase 2 study in patients with brain metastases arising from breast cancer. This analysis showed that there were no confirmed intra-cranial responses, as determined by an Independent Review Facility, among the first 30 evaluable patients in the trial. Data from the analysis will be presented in a poster at the San Antonio Breast Cancer Symposium on December 6. In addition, the company is discontinuing GRABM-L, its Phase 2 study in patients with brain metastases arising from non-small cell lung cancer, because of the inability to successfully enroll the trial. Geron has provided to Angiochem, Inc. notice of termination of both the exclusive license agreement under which Geron received rights to GRN1005 and an associated research collaboration and option agreement. Geron will be reporting the results of a phase 2 study of single agent imetelstat in patients with essential thrombocythemia (ET) in an oral presentation at the American Society of Hematology annual meeting on December 9. The ET study was designed to provide proof-of-concept for the potential use of imetelstat as a treatment for various hematologic myeloid malignancies, including myelofibrosis, myelodysplastic syndromes and acute myelogenous leukemias. JAK2 mutations are quantified during the trial to evaluate the effect of the drug on the malignant progenitor cells driving the disease. The top-line results from 14 patients enrolled in this study, all of whom were refractory to or intolerant of conventional therapies, showed a hematologic response rate of 100% (with 93% of patients achieving a complete response) and a molecular response rate of 86% among the seven patients who had a JAK2 mutation. These hematologic and molecular response rates, which exceeded the company's expectations, suggest a selective inhibition of the malignant progenitor cells responsible for the patients' malignancy, and therefore potential disease-modifying activity by imetelstat that may be applicable in other hematologic myeloid malignancies. Based on these results, Dr. Ayalew Tefferi, M.D., at the Mayo Clinic has begun an investigator-sponsored pilot study to evaluate safety and efficacy of imetelstat in patients with myelofibrosis, a myeloproliferative neoplasm in the same spectrum of diseases as ET. For more information about this study, please refer to http://clinicaltrials.gov/ct2/show/NCT01731951. The company is in the initial planning stages of a Geron-sponsored Phase 3-enabling study in myelofibrosis, which will be informed, in part, by data from the Mayo Clinic study. In addition, Geron intends to expand its directed program of investigator-sponsored trials in 2013 to other hematologic myeloid indications, including acute myelogenous leukemias. Imetelstat Development in Solid Tumors Associated with Short Telomeres Published non-clinical data have demonstrated that tumor cells with short telomeres are more sensitive to telomerase inhibition with imetelstat than tumor cells with longer telomeres. To evaluate this hypothesis clinically, Geron included a pre-specified sub-group analysis of results by tumor telomere length in its randomized Phase 2 trial of imetelstat in non-small cell lung cancer. In September 2012, Geron reported that an unplanned interim safety and efficacy analysis of the data from that trial suggested a modest but not statistically significant trend in progression-free survival in favor of the imetelstat treatment arm in the overall study population (hazard ratio = 0.78). However, the pre-specified sub-group analysis suggested that imetelstat-treated patients whose tumors had short telomeres at baseline experienced a clinically meaningful, statistically significant increase in progression-free survival compared to patients in the control arm (n = 19; hazard ratio = 0.32; p = 0.042), which was not observed in imetelstat-treated patients whose tumors had medium-to-long telomeres (n = 38; hazard ratio = 0.83; p = 0.62). The company expects to present the data from the full sub-group analysis at a scientific conference in 2013. The company is working on a refined assay to prospectively measure telomere length in individual patient tumor samples, which would be required if Geron conducts a Phase 3-enabling clinical study of the effect of imetelstat in patients with solid tumors that have short telomeres. Management Changes In connection with the restructuring, Graham Cooper, the company's Chief Financial Officer, will be leaving the company to pursue other opportunities. Olivia Bloom, currently Vice President of Finance, Chief Accounting Officer and Treasurer, will assume the role of Chief Financial Officer effective December 7. In addition, Geron has appointed Craig C. Parker, as Senior Vice President, Corporate Development and as a member of the executive management team, effective immediately. Mr. Parker has over 25 years experience in the science and business of the biotechnology industry, and was most recently Senior Vice President, Strategy and Corporate Development at Human Genome Sciences, Inc., until its sale to Glaxo SmithKline in 2012.