Transgene (TNG: FP), a French biotechnology company with the ambitious goal of taking oncolytic viruses to the market is facing a significant hurdle. A clinical trial reviewed by an independent group deemed their trial meant to treat patients with liver cancer (HPC) useless. A blow to Transgene’s hope to break a market that is worth $44 Billion by 2023.

Transgene’s scientists engineered an oncolytic vaccinia virus to be armed with GM-CSF, a gene that promotes an immune response and anti-tumor effects. A brilliant idea, the mechanism behind GM-CSF is to kick start the immune system. A promoter of white blood cells, granulocytes, macrophages and platelets, cells that are necessary to help fight off cancer and solid tumors. Solid tumors remain a mystery for many scientists and researchers as they continue their pursuit of discovering new ways to break-in. A need that is still unmet by big pharma and biotech; to this date, patients with solid tumors need radiation or surgery. These treatments become more complicated when a patient’s tumor is present near crucial organs.

The news of Transgene’s failure in phase III shook many investors who saw Transgene as the next billion-dollar biotech company. As soon as the press release came for PEXA-VAC and its phase III flop, investors were selling Transgene to stop any further losses. The stock took a loss of more than 20 percent, tanking it from 2.34 to 1.85 a share, making many investors cautious in investing in biotech companies with similar ambitions.

Although Transgene did not disclose why they decided to stop PEXA-VEC, we can assume that the independent group didn’t find any benefits to patients. A surprise for many investors, who have heard pitches from biotechnology start-ups and pharmaceutical giants investing in oncolytic virus research. Hopefully, Transgene’s failure with HPC patients isn’t foreshadowing the future of where the industry and similar programs will go.

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