ONTX Good news and semibad news.

The stock I recommended 1 June (ONTX) was up 11% today on a fourfold increase in volume. The rationale based on a Cell paper (vol. 165 pp. 643 – 655 ’16 ) will be found in a copy of the entire post below the ****

It is worth looking at the chart — https://finance.yahoo.com/echarts?s=ONTX+Interactive#{“range”:”1d”,”allowChartStacking”:true}

After a delay in opening, it exploded most of the way up on high volume (for it). Why? My guess is that people looked at the poster of the study in progress using their Ras blocking drug Rigosertib. Who looked? Why some of the 30,000 attendees at the 2016 American Society of Clinical Oncology Annual Meeting in Chicago, Illinois.

Why is this good (aside from the rise)? Assuming the people who bought ONTX were attendees at the convention, these are very informed buyers (e.g. professional oncologists) laying down their long green (e.g. very smart money).   In one of the many books I read about the Bernie Madoff Ponzi scheme, the people who invested with him were described as ‘dumb money’. They’d made their pile elsewhere and were babes in the woods when it came to investing.

Why is this also bad for what I predicted? Have a look at the abstract of one of the posters. Here’s a link to it —
http://meetinglibrary.asco.org/content/165681-176

The skinny is that the phase III study I was so excited about began only last December. It likely will be years before the results will be in. So goodbye 10x – 100x pop in the stock right away. Possibly big pharma will be impressed with their work and buy out the company which should also mean a significant gain.

Now 30,000 people can’t crowd around a single poster presentation. The stock is likely to continue moving up on volume this week as word spreads from the people who’ve already bought it and more people see the possibilities.

Here’s the post of 1 June — note that I didn’t own ONTX when I wrote the first post 3 May ’16, but did when I wrote the 1 June post.

*****

In a gambling mood?

If a pair of posters to be presented Monday 6 June at the 2016 American Society of Clinical Oncology Annual Meeting in Chicago, Illinois, contains the results of a phase III clinical trial of rigosertib, and if the results are as good as a paper discussed below the stock Onconova Therapeutics (ONTX) will jump by a factor of 10 to 100.

Full disclosure: I own some. The posters may just describe the clinical trial rather than report the results in which case all bets are off. In that case, I’ll just hold the stock until the results are in. This isn’t the ‘pump and dump’ beloved of boiler room operators everywhere. The rationale for the drug and my take on the original paper (3 May ’16) are reproduced below.

Has the great white whale of oncology finally been harpooned?

The ras oncogene is the great white whale of oncology. Mutations in 20 – 40% of cancer turn its activity on so that nothing can turn it off, resulting in cellular proliferation. People have been trying to turn mutated ras off for years with no success.

A current paper [ Cell vol. 165 pp. 643 – 655 ’16 ] describes a new and different way to attack it. Once ras is turned on (either naturally or by mutation) many other proteins must bind to it, to produce their effects — they are called RAS effectors, among which are the uneuphoniously named RAF, RalGDS and PI3K. They bind to activated ras by the cleverly named Ras Binding Domain (RBD) which has 78 amino acids.

The paper describes rigosertib, a not that complicated molecule to the chemist, which inhibits the binding (by resembling the site on ras that the RBD binds to). It is a styryl benzyl sulfone and you can see the structure here — https://en.wikipedia.org/wiki/Rigosertib.

What’s good about it? Well it is in phase III trials for a fairly uncommon form of cancer (myelodysplastic syndrome). That means it isn’t horribly toxic or it wouldn’t have made it out of phase I.

Given the mechanism described, it is possible that Rigosertib will be useful in 20 – 40% of all cancer. Can you say blockbuster drug?

Do you have a speculative bent? Buy the company testing the drug and owning the patent — Onconova Therapeutics. It’s quite cheap — trading at $.40 (yes 40 cents !). It once traded as high as $30.00 — symbol ONTX. I don’t own any (yet), but for the price of a movie with a beer and some wings afterwards you could be the proud owner of 100 shares. If Rigosertib works, the stock will certainly increase more than a hundredfold.

Enough kidding around. This is serious business. In what follows you will find some hardcore molecular biology and cellular physiology showing just what we’re up against. Some of the following is quite old, and probably out of date (like yours truly), but it does give you the broad outlines of what is involved.

The pathway from Ras to the nucleus

The components of the pathway had been found in isolation (primarily because mutations in them were associated with malignancy). Ras was discovered as an oncogene in various sarcoma viruses. Mutations in ras found in tumors left it in a ‘turned on’ state, but just how ras (and everything else) fit into the chain of binding of a growth factor (such as platelet derived growth factor, epidermal growth factor, insulin, etc. etc.) to its receptor on the cell surface to alterations in gene expression wasn’t clear. It is certain to become more complicated, because anything as important as cellular proliferation is very likely to have a wide variety of control mechanisms superimposed on it. Although all sorts of protein kinases are involved in the pathway it is important to remember that ras is NOT a protein kinase.

l. The first step is binding of a growth factor to its receptor on the cell surface. The receptor is usually a tyrosine kinase. Binding of the factor to the receptor causes ‘activation’ of the receptor. Activation usually means increasing the enzymatic activity of the receptor in the tyrosine kinase reaction (most growth factor receptors are tyrosine kinases). The increase in activity is usually brought about by dimerization of the receptor (so it phosphorylates itself on tyrosine).

2. Most activated growth factor receptors phosphorylate themselves (as well as other proteins) on tyrosine. A variety of other proteins have domains known as SH2 (for src homology 2) which bind to phosphorylated tyrosine.

3. A protein called grb2 binds via its SH2 domain to a phosphorylated tyrosine on the receptor. Grb2 binds to the polyproline domain of another protein called sos1 via its SH3 domain. At this point, the unintiated must find the proceedings pretty hokey, but the pathway is so general (and fundamental) that proteins from yeast may be substituted into the human pathway and still have it work.

4. At last we get to ras. This protein is ‘active’ when it binds GTP, and inactive when it binds GDP. Ras is a GTPase (it can hydrolyze GTP to GDP). Most mutations which make ras an oncogene decrease the GTPase activity of RAS leaving it in a permanently ‘turned on’ state. It is important for the neurologist to know that the defective gene in type I neurofibromatosis activates the GTPase activity of ras, turning ras off. Deficiencies (in ras inactivation) lead to a variety of unusual tumors familiar to neurologists.

Once RAS has hydrolyzed GTP to GDP, the GDP remains bound to RAS inactivating it. This is the function of sos1. It catalyzes the exchange of GDP for GTP on ras, thus activating ras.

5. What does activated ras do? It activates Raf-1 silly. Raf-1 is another oncogene. How does activated ras activate Raf-1 ? Ras appears to activate raf by causing raf to bind to the cell membrane (this doesn’t happen in vitro as there is no membrane). Once ras has done its job of localizing raf to the plasma membrane, it is no longer required. How membrane localization activates raf is less than crystal clear. [ Proc. Natl. Acad. Sci. vol. 93 pp. 6924 – 6928 ’96 ] There is increasing evidence that Ras may mediate its actions by stimulating multiple downstream targets of which Raf-1 is only one.

6. Raf-1 is a protein kinase. Protein kinases work by adding phosphate groups to serine, threonine or tyrosine. In general protein kinases fall into two classes those phosphorylating on serine or threonine and those phosphorylating on tyrosine. Biochemistry has a well documented series of examples of enzymes being activated (or inhibited) by phosphorylation. The best worked out is the pathway from the binding of epinephrine to its cell surface receptor to glycogen breakdown. There is a whole sequence of one enzyme phosphorylating another which then phosphorylates a third. Something similar goes on between Raf-1 and a collection of protein kinases called MAPKs (mitogen activated protein kinases). These were discovered as kinases activated when mitogens bound to their extracellular receptors.There may be a kinase lurking about which activates Raf (it isn’t Ras which has no kinase activity). Removal of phosphate from Raf (by phosphatases) inactivates it.

7. Raf-1 activates members of the MAPK family by phosphorylating them. There may be several kinases in a row phosphorylating each other. [ Science vol. 262 pp. 1065 – 1067 ’93 ] There are at least three kinase reactions at present at this point. It isn’t known if some can be sidestepped. Raf-1 activates mitogen activated protein kinase kinase (MAPK-K) by phosphorylation (it is called MEK in the ras pathway). MAPK-K activates mitogen activation protein kinase (MAPK) by phosphorylation. Thus Raf-1 is actually mitogen activated protein kinase kinase kinase (sort of like the character in Catch-22 named Junior Junior Junior). (1/06 — I think that Raf-1 is now called BRAF)

8. The final step in the pathway is activation of transcription factors (which turn genes off or on) by MAP kinases by (what else) phosphorylation. Thus the pathway from cell surface is complete.

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