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Following a special meeting of its board of directors, Tracon Pharmaceuticals has terminated employees and will wind down operations. Tracon Pharmaceuticals has decided to wind down operations weeks after an injectable immune checkpoint inhibitor that was licensed from China flunked a pivotal trial in a rare cancer.The biotech gave up on envafolimab after the subcutaneous PD-L1 inhibitor only triggered responses in four out of 82 patients who had already received therapies for their undifferentiated pleomorphic sarcoma or myxofibrosarcoma. At 5%, the response rate was below the 11% the company had been aiming for.The disappointing results ended Tracon’s plans to submit envafolimab to the FDA for approval as the first injectable immune checkpoint inhibitor, despite the drug having already secured the regulatory green light in China.At the time, CEO Charles Theuer, M.D., Ph.D., said the company was moving to “immediately reduce cash burn” while seeking out strategic alternatives.It looks like those options didn’t pan out, and, this morning, the San Diego-based biotech said that following a special meeting of its board of directors, the company has terminated employees and will wind down operations. As of the end of 2023, the small biotech had 17 full-time employees, according to its annual securities filing.It’s a dramatic fall for a company that only weeks ago was eyeing the chance to cement its position with the first subcutaneous checkpoint inhibitor approved anywhere in the world. Envafolimab claimed that title in 2021 with a Chinese approval in advanced microsatellite instability-high or mismatch repair-deficient solid tumors regardless of their location in the body. The tumor-agnostic nod was based on results from a pivotal phase 2 trial conducted in China.Tracon in-licensed the North America rights to envafolimab in December 2019 through an agreement with the drug’s Chinese developers, 3D Medicines and Alphamab Oncology.

Tracon licensed the North American rights to envafolimab from China-based Jiangsu Alphamab Biopharmaceuticals and 3D Medicines in 2019. Image Credit: TarikVision / Shutterstock. TRACON Pharmaceuticals has terminated the Phase II ENVASARC trial for its sarcoma therapy, envafolimab , as the therapy is unlikely to show the level of efficacy required to support a biologics licence application (BLA). The decision to scrap the Phase II ENVASARC trial (NCT04480502) was informed by a blinded independent central review analysis that showed that the therapy’s objective response rate (ORR) is 5% in the 82 patients evaluated for the analysis. This is lower than the 11% ORR needed to meet the trial’s primary endpoint and support a BLA. Tracon has discontinued all its clinical development activities related to envafolimab and plans to reduce its cash burn. The company also plans to explore strategic alternatives, including a “merger, reverse merger, acquisition, other business combination, sales of assets, licensing or other strategic transactions”. The main asset that the company plans to leverage is its in-house product development platform. Tracon claims that the platform can offer cost and time savings while remaining independent of contract research organisations (CROs). Following the news, the company stock was down by 30.6% at market close on 1 July, compared to market close on 28 June. Tracon’s market cap now stands at $2.97m. Sarcomas are rare cancers that develop in the bones and soft tissues. Tracon investigated envafolimab as a treatment for two types of advanced or metastasised soft tissue sarcomas, undifferentiated pleomorphic sarcoma, or myxofibrosarcoma. See Also: CAN-3110 by Candel Therapeutics for High-Grade Glioma: Likelihood of Approval ICTCAR-028 by Innovative Cellular Therapeutics for Hematological Tumor: Likelihood of Approval Envafolimab is a programmed death ligand 1 (PD-L1) targeting single-domain antibody. Tracon licenced North American rights to the therapy from China-based Jiangsu Alphamab Biopharmaceuticals and 3D Medicines in 2019. In 2021, envafolimab was approved in China as a treatment for advanced microsatellite instability-high (MSI-H) or deficient mismatch repair (dMMR) advanced solid tumours, including advanced colorectal cancer. The therapy also received a breakthrough designation last year as a second-line treatment for non-MSI-H/non-dMMR advanced endometrial cancer, in China. Other therapies in Tracon’s pipeline include YH001, a cytotoxic T lymphocyte-associated antigen 4 (CTLA-4)-targeting antibody being developed in partnership with China-based Eucure Biopharma, and TRC102 (methoxyamine), a small molecule inhibitor of the DNA base excision repair pathway.

The objective response rate by blinded independent central review in the fully enrolled ENVASARC pivotal trial in the 82 evaluable patients is 5% (four responders) and did not meet the primary endpoint of 11% Company will focus on exploring strategic alternatives, that may include a variety of strategic transactions such as a reverse merger, acquisition, sale of all assets, or other strategic transactions leveraging its in-house Product Development Platform of CRO-independent clinical trial execution SAN DIEGO, July 01, 2024 (GLOBE NEWSWIRE) -- TRACON Pharmaceuticals (NASDAQ: TCON) today announced the objective response rate (ORR) by blinded independent central review (BICR) in the fully enrolled ENVASARC pivotal trial in the 82 evaluable patients is 5% (four responders), which is lower than the primary endpoint of the study of 11% ORR by BICR needed to support a biologics license application (BLA). As a result, the Company is terminating further development of envafolimab and is focusing entirely on exploring strategic alternatives in the near term that may include, but are not limited to, a merger, reverse merger, acquisition, other business combination, sales of assets, licensing or other strategic transactions involving the Company. In pursuit of any potential strategic transaction, TRACON plans to leverage its turnkey in-house Product Development Platform (PDP) utilizing integrated Veeva systems that has been used to conduct more than 15 Phase 1, 2 or 3 oncology trials at more than 120 sites in the U.S. and Europe across more than ten tumor types over 12 years, at a fully burdened cost of less than $100,000 per patient. TRACON offers cost-savings, time savings and enhanced quality of clinical trials using its PDP. There can be no assurance the exploration of strategic alternatives will result in any agreements or transactions, or, if completed, any agreements or transactions will be successful or on attractive terms. To the extent that it cannot complete a strategic transaction, there is no guarantee that the Company will continue as a going concern. TRACON does not expect to disclose developments with respect to this process until the evaluation of strategic alternatives has been completed or the Board of Directors has concluded disclosure is appropriate or legally required. “We are proud of our execution of the largest trial ever done in the sarcoma subtypes of undifferentiated pleomorphic sarcoma and myxofibrosarcoma using TRACON’s Product Development Platform,” said Charles Theuer, M.D., Ph.D., TRACON’s Chief Executive Officer. “While individual patients derived benefit from envafolimab, the response rate by blinded independent central review in the ENVASARC trial of envafolimab as a single agent does not support a BLA. We are therefore discontinuing all of our clinical development activities and intend to take action to immediately reduce cash burn to better position the company for this strategic alternative process. We plan to leverage the value of our PDP in pursuing strategic alternatives.” About ENVASARC (NCT04480502) The ENVASARC pivotal trial is a multicenter, open label, randomized, non-comparative, parallel cohort study at 30 top cancer centers in the United States and the United Kingdom that began dosing in December 2020. The primary endpoint is ORR by blinded independent central review of nine responses in cohort C of approximately 80 patients with duration of response a key secondary endpoint. The trial was fully enrolled and the primary endpoint was not met. As a result, TRACON discontinued further development of envafolimab. About TRACON TRACON utilizes a cost-efficient, CRO-independent, product development platform to advance development of therapeutics faster and at lower cost. TRACON believes it can serve as a solution for companies without clinical capabilities who wish to become CRO-independent. To learn more about TRACON, visit TRACON’s website at www.traconpharma.com. Forward-Looking Statements Statements made in this press release regarding matters that are not historical facts are “forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward‐looking statements. Such statements include, but are not limited to, statements regarding the anticipated benefits of TRACON’s PDP platform, including advantages related to cost, timing and quality of conduct of clinical trials; TRACON’s ability to complete a strategic transaction; TRACON’s ability to continue as a going concern even if a strategic transaction is completed; TRACON’s ability to leverage its in-house PDP of CRO-independent clinical trial execution in connection with a strategic transaction; anticipated benefits of a merger, reverse merger, acquisition, other business combination, sales of assets, licensing or other strategic transactions of TRACON; TRACON’s ability to preserve cash during the strategic alternatives process; or other statements not of historical fact. Risks that could cause actual results to differ from those expressed in these forward‐looking statements include: risks relating to cost variability of clinical trials; whether TRACON will be able to complete or achieve the anticipated benefit from any potential strategic transactions, including any potential strategic transactions leveraging its PDP; whether TRACON will be able to obtain additional financing on favorable terms or at all; and other risks described in TRACON’s filings with the Securities and Exchange Commission under the heading “Risk Factors”. All forward‐looking statements contained in this press release speak only as of the date on which they were made and are based on management’s assumptions and estimates as of such date. TRACON undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made except as required by law. Company Contact:Investor Contact:Charles TheuerBrian RitchieChief Executive OfficerLifeSci Advisors LLC(858) 550-0780(212) 915-2578ctheuer@traconpharma.combritchie@lifesciadvisors.com