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Telik, Inc. (TELK): Telintra Granted Orphan Drug Designation by the FDA

Telik, Inc. (TELK) is a clinical stage drug development company focused on discovering and developing small molecule drugs to treat cancer. Telik’s product candidates are:

  • TELINTRA® (TLK199) is in Phase 2 clinical development for myelodysplastic syndrome, and severe chronic idiopathic neutropenia
  • TELCYTA® (TLK286) is a cancer cell-activated chemotherapeutic that has shown clinical activity in Phase 2 and Phase 3 clinical trials in advanced ovarian cancer, non-small cell lung cancer, colon cancer and breast cancer
  • Other product candidates are under Telik’s TRAP®, proprietary technology platform, which enables the rapid and efficient discovery of small molecule drug candidates

TELK announced on Friday that its product candidate, Telintra, has been granted orphan drug designation by the US Food and Drug Administration (FDA) for the treatment of myelodysplastic syndrome (MDS).

Orphan designation grants offered the following potential advantages:

  • US market exclusivity to a drug for the treatment of a specified condition for a period of seven years following FDA marketing approval
  • Potential new development grants
  • Tax credits related to clinical trial expenses
  • Protocol development assistance and exemption from FDA user fees

Telintra is an investigational agent in development for the treatment of MDS and idiopathic chronic neutropenia, a inhibitor of the enzyme glutathione S-transferase P1‑1, leading to activation of Jun kinase, a key regulator of cellular growth and differentiation of blood precursor cells. It has been shown to cause clinically significant and sustained reduction in red blood cell transfusions, transfusion independence and multilineage responses in MDS patients.

TELK stock jumped 105% on Friday’s trading session, ended at $2.98 per share on 48fold of its 10day average volume.

Key points:

  • Burning rate will blow out TELK available cash in the next quarter
  • Clinical trials will require more funding at the end of Q1- or beginning of Q2 2013
  • No signifficant short interest, thus no short squeeze is expected

Second offering is imminent. Short position in TELK is a way to go.