Thread regarding Endocyte Inc. layoffs

Endocyte, West Lafayette - Laying Off 40% of Workforce

6/12/17: Article from Journal and Courier, Lafayette IN:

Endocyte's fall in the market reflects strong core principles

WEST LAFAYETTE, Ind. — Last week business journals and stock market trackers reported that Endocyte, a West Lafayette cancer drug development company, experienced a major downturn in the market.

The fall in share prices was linked to Endocyte’s discontinuation of trials on its EC1456 drug and narrowing the scope of study on another drug, EC1169.

The decision to pare down trials, however, reflects a commitment to clinical trial patients and responsible spending not always shared by pharmaceutical companies.

Mike Sherman, Endocyte president and CEO, said any time a company has to prematurely discontinue a trial it often has an immediate and negative impact on the company's stock.

“For this kind of company investors are looking for the promise of a drug and positive data announced or coming soon. Any time you have a trial that stops or fails to meet an endpoint you have negative news for stocks,” Sherman said.

Sherman added that not all drug development companies would have made the decision to stop the EC 1456 trial, but Endocyte takes its responsibility towards patients seriously.

EC 1456 was a drug that targeted the folate receptor, a receptor that grabs folic acid from the blood stream, which helps cells divide. If the cells are cancerous this can lead to a more rapid evolution of the disease. Targeting this receptor, researchers hoped, would interfere with cell division, slowing the multiplication of cancer cells.

When taking a comprehensive view of the data, however, Sherman said, the results simply weren’t strong enough to justify continuing trials.

Not only would it divert dollars way from research and trials with greater potential, Sherman said, but it could prevent patients in the clinical trials from seeking other forms of cancer therapy.

“We put the patients first. Period. The decision was very much influenced by that. … Would I encourage my mother or father to participate in this trial is always the question I keep in the back of my mind,” Sherman said.

Although this recent decision did require the company to lay off roughly 30 employees and some investors to lose confidence, Sherman said it’s a move he thinks will ultimately strengthen the company.

Now, he said, there is potential to divert funds into lines of research with the potential to yield better results.

Although Endocyte will narrow its trials for the drug EC1169, a compound used to treat prostate cancer, Sherman thinks this is one area that has great potential

The company is also making inroads in areas of immunotherapy and another therapy that simultaneously targets a tumor and microphage, inflammatory cells that can form a protective wall around the cancer cells.

“We now have a strong cash position to be able to develop those,” Sherman said.

Graham Cooks is a chemistry professor at Purdue University whose field of research includes cancer diagnostics.

Cooks said Endocyte’s proximity to the university helps spur research and innovation there.

“It’s enormously beneficial to the research community at Purdue,” Cooks said. “They’ve been a leading example of the way in which drug discovery, development and diagnostic can be done. It’s outstanding because we have so few commercial entities like that in the area.”

And the relationship is mutual, Sherman said.

The company’s headquarters are housed within the Purdue Research Park and Endocyte researchers maintain collaborations with professors at Purdue.

Cooks said you primarily get forward-thinking companies like Endocyte in hubs like Boston or San Diego. Having Endocyte here, he added, is enormously beneficial to academic and medical communities.

“It’s super uncommon,” Cooks said. “Now we need a half dozen more.”

Reach Journal & Courier reporter Emma Ea Ambrose at or 765-431-1192.

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