MEI Pharma halts capital return to focus on drug development

SAN DIEGO - MEI Pharma, Inc. (NASDAQ: MEIP ), a clinical-stage pharmaceutical company specializing in cancer therapies, has announced a strategic shift following recent clinical trial data. The company's Board of Directors has unanimously decided against a second capital return under the October 31, 2023, cooperation agreement with Anson Funds and Cable Car Capital.

This move aims to conserve resources and extend the company's operational runway, allowing for focused investment in its promising oncology candidates, voruciclib and ME-344.

The decision was influenced by positive clinical data results for both drug candidates. Voruciclib, an oral CDK9 inhibitor, has shown potential in combination with venetoclax for treating relapsed/refractory acute myeloid leukemia (AML) patients without actionable mutations.

ME-344, on the other hand, is being explored as a treatment for various solid tumors in combination with VEGF inhibitors like Avastin®, aiming to create synthetic lethality in tumor cells.

MEI Pharma's leadership team, praised for their experience in oncology therapeutics, is set to continue advancing these programs. The company's strategic plan includes advancing voruciclib to new value inflection points by the end of 2025 and developing a new formulation of ME-344 for a Phase 1 study.

The updated strategy for ME-344 follows recent study results, which indicated a 25% progression-free survival rate at 16 weeks in patients with metastatic colorectal cancer, surpassing the 20% threshold set in the study protocol.

While the threshold for a second capital return under the cooperation agreement was not met, the board's unanimous decision reflects a commitment to aligning investment with strategic objectives and maximizing shareholder value.

MEI Pharma will continue to prioritize its pipeline development, with plans to initiate a Phase 3 registration trial for voruciclib during 2026, contingent on successful Phase 1/2 study results. The company's decision to focus on developing a new formulation of ME-344 is intended to increase biological activity, improve administration convenience, and enhance commercial prospects.

This article is based on a press release statement from MEI Pharma. The company remains dedicated to developing innovative cancer therapies and improving patient outcomes in the oncology field.

InvestingPro Insights

MEI Pharma, Inc. (NASDAQ:MEIP) appears to be in a strong financial position, with cash reserves that surpass its debt, according to InvestingPro Tips. This is a crucial factor for investors to consider as the company decides to conserve resources and invest in its oncology drug candidates.

In addition, analysts are optimistic about MEI Pharma's prospects, predicting not only that the company will be profitable this year but also expecting net income growth.

InvestingPro Data shows a market capitalization of $25.05 million for MEI Pharma, reflecting the company's current valuation in the market. The stock's P/E ratio stands at a modest 1.28, with a slight adjustment to 1.31 when looking at the last twelve months as of Q2 2024. This low P/E ratio could suggest that the stock is undervalued relative to its earnings.

Furthermore, the company's revenue growth is notable, with a 16.1% increase in the last twelve months as of Q2 2024, which may be indicative of its potential to sustain growth in the competitive pharmaceutical industry.

For investors seeking more comprehensive analysis and personalized insights, MEI Pharma has additional InvestingPro Tips available on InvestingPro. With a total of 7 additional tips provided, these insights can help investors make more informed decisions. To access these tips and other valuable investment tools, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.