Clovis CEO: We can win against AstraZeneca

Clovis Oncology CEO Patrick Mahaffy told CNBC he's been the underdog for most of his career.

"It probably would be fun to be an overdog one time," he said in an interview Monday from the American Society of Clinical Oncology meeting, where the biotech company presented data on its experimental drug for lung cancer, CO-1686, that will compete with a similar one from British drug giant AstraZeneca.

Tuesday's not that day. Clovis' stock recently hit a fresh 52-week low and was recently down 16 percent, adding to Monday's losses, on concerns AstraZeneca's experimental medicine, AZD9291, will edge Clovis' out. (For the latest Clovis stock quote, click here.)

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Citi analyst Yaron Werber downgraded Clovis' stock Tuesday to "neutral" from "buy," writing: "We now have more clarity on AZD9291 and its profile looks comparatively better than CO-1686. With a cleaner profile, no major toxicity issues, and possible ... path to market ahead of CO-1686, we have to re-assess our previous view on the stock as CO-1686 will likely not offer any tangible benefits based on the current profile."

Questions arose at the conference over the side effect profiles of both drugs—AstraZeneca's is associated with "interstitial lung disease-like" effects and rash in some patients, while Clovis' is linked to high blood sugar for some. At an investor event over the weekend, Mahaffy noted three patients started on insulin while taking CO-1686, prompting some to say the drug causes diabetes.

"We do, like all oncology drugs, see some side effects," Mahaffy said. "About 20 percent of patients get some hyperglycemia. It's, in almost everybodyespecially as we've understood it nowreadily and easily managed with metformin, which is a widely available oral agent."

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He also addressed the diabetes question: "We have had about three patients who, when this first emerged we weren't sure exactly how to treat it, and they did go on insulin briefly, but no, we do not cause diabetes."

Patrick Mahaffy, President and Chief Executive Officer at Clovis Oncology.
Kathryn Scott Olser | The Denver Post | Getty Images
Patrick Mahaffy, President and Chief Executive Officer at Clovis Oncology.

Mahaffy holds that Clovis' drug will succeed based on superior data, specifically in showing longer progression-free survival, a measure of how long patients live without their cancer advancing. He noted that while the data are young, they are showing that the length of time patients can maintain a benefit from the drug "is trending for beyond a year."

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"I'm really confident with the progression-free survival we've seen, that knowing what we know right now—and I'll acknowledge that it's early days—I think we have a very meaningful potential to demonstrate a more meaningful improvement on progression-free survival," Mahaffy said of the competition with AstraZeneca. "The data thus far, early days, is showing that."

—By CNBC's Meg Tirrell