What Went Wrong With Evoke Pharma Inc (NASDAQ:EVOK)?


Evoke Pharma Inc (NASDAQ:EVOK) just announced topline data from its phase III in its lead diabetic gastroparesis, and it’s not good. The trial missed its primary endpoint, and the company is down more than 72% mid session US as a direct result of the report. The thing is, the data runs against all expectations, and doesn’t really make any sense. The drug in question is a reformulation of a compound used for the last three decades in this indication, and Evoke was simply trying to prove a nasal administration could be equivalent in efficacy to the current oral option. Instead of proving this equivalence, the drug didn’t even show to be any more effective than placebo.

So, what happened, and what does this mean going forward? Let’s try and figure it out.

As mentioned, the drug in question, EVK-001, is a nasal spray reformulation of a drug called metoclopramide. The latter picked up approval in 1980, and is the standard of care treatment for diabetic gastroparesis in women with diabetes mellitus. The condition is a result of the stomach muscles not contracting efficiently to break down food and pass it in to the small intestine. The science is pretty complicated, but simply put, it influences receptors associated with gastro-kinetic activity. By acting as an agonist to these receptors, it promotes muscle movement, and effectively treats the symptoms associated with the condition.

Evoke’s formulation is a nasal spray. The nasal wall is thin enough to allow absorption of these sorts of compounds, so there should have been no reason that the reformulation impacted uptake. Plus, it’s systematic. This has a couple of advantages. Primarily, it doesn’t need to pass through the gastrointestinal tract before it starts to work (in a condition like this, the advantages of this don’t need to be pointed out). Symptoms of the condition also include nausea, which again, offers up a justification for a nasal spray over an oral route treatment.

So what went wrong?

Well, phase II data suggested efficacy, and safety hasn’t been an issue across the entire development process. As such, markets almost looked at this pivotal as a formality. That’s why the response has been so severe from a market cap loss perspective. Let’s for a minute assume that the drug is effective, and that there is a reason other than inefficacy for the trial not meeting its endpoint. The logical reason here is some issue with the trial. What might cause a misrepresentation of efficacy? Some type of inefficiency in the data, or interpretation of the results. Is this a possibility? Yes. The endpoint in question was an improvement in symptoms as measured from baseline at four weeks, using what’s called a Patient Reported Outcome (PRO) instrument. This instrument was basically a telephone diary and interpretation of the diarized results. In other words, the patients were recording the results based on their own interpretation of symptom severity, from home.

Of course, this is why companies use a placebo arm, but there is so much room for misinterpretation in this particular trial design that it’s reasonable to conclude that there may have been an error in efficacy representation.

So what now? Well, Evoke is going to take a deeper look at the data, and see if it can figure out exactly what went wrong. There are a few things that need addressing. First and foremost, however, why did the results vary so much with location? At 28 sites, EVK-001 beat out against placebo. At the other 13, placebo came out on top. From a stat analysis point of view, that doesn’t make any sense, and if the company can get to the bottom of the discrepancy, it may be able to uncover the efficacy issues.

We’ll see.

Bottom line here is that this trial shouldn’t have failed, but it did. It’s biotech, yes, so nothing is ever certain, but there’s something not right about these data and their interpretation. If Evoke can team up with the FDA to figure out what went wrong, there could be plenty of room for a recovery going forward. Definitely one to keep an eye on as we head into the latter half of the year.

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