Massachusetts Sues Fannie and Freddie 0ver Foreclosure Law

Martha Coakley, the attorney general of Massachusetts, filed suit on Monday against Fannie Mae and Freddie Mac in an effort to force the federally owned mortgage finance giants to comply with a state antiforeclosure law passed in 2012.

The law seeks to ease the way for so-called buyback programs, which are aimed at reducing the debt of the homeowner while saving the lender the cost of foreclosure and eviction. Fannie and Freddie have refused to allow homes with mortgages they back to enter buyback programs, the suit contends, even though it costs them money not to.

"For too long, Fannie and Freddie have been roadblocks to progress in addressing this foreclosure crisis, and I urge them to immediately reverse their policy on this common-sense program," Ms. Coakley said in a statement.

The lawsuit is one of numerous aggressive efforts by Ms. Coakley, a Democratic candidate for governor, to police banks' treatment of homeowners and their securitization of mortgages. She has won settlements from Goldman Sachs, Morgan Stanley, RBS and several subprime lenders.

The lawsuit comes on the heels of a case by a homeowner, Ramon Suero, who bought an apartment for about $300,000 in 2005 that is now worth a third of that price. He fell behind on his mortgage payments, and the home went into foreclosure.

Boston Community Capital, a nonprofit that runs a buyback program called SUN (Stabilizing Urban Neighborhoods), offered to buy it from the lender for what Freddie Mac said was the fair market price, $115,000. SUN intended to turn around and sell the house back to Mr. Suero, giving him a mortgage he could afford.

But Freddie Mac refused to allow the sale, instead asking SUN for a "make whole" price of the full $300,000. Without the buyback allowing Mr. Suero to stay in his home, Freddie Mac would normally incur the expense of evicting Mr. Suero, maintaining the vacant home and selling it as a distressed property.

A federal court issued a preliminary injunction against the foreclosure and sale of the home. The Federal Housing Finance Agency, which oversees Fannie and Freddie, declined to comment on pending litigation. Ms. Coakley's office had written a previous letter to Mel Watt, who became the agency's director in January.

Mr. Watt succeeded the acting director, Edward J. DeMarco, who would not allow Fannie and Freddie to go along with such debt-reduction programs even though the agency's own analysis showed it would save money for taxpayers.

Mr. DeMarco had argued that the agency's other loan modification programs were just as good, and said he feared that it would cause homeowners to strategically default on their payments.

For similar reasons, many lenders approving short sales require that it be an "arm's-length transaction," where the buyer and seller are not related. The Massachusetts law specified that banks could not decline buyback programs if the buyer was a reputable nonprofit.

Mr. Watt has not yet weighed in on the subject of debt reduction.

Elyse D. Cherry, chief executive and president of SUN, said dozens of homeowners, many of them immigrants and minorities in poor neighborhoods, had been prevented from taking advantage of the SUN buyback program because Fannie and Freddie had barred participation.

Ms. Cherry's organization was instrumental in passing the 2012 law in Massachusetts and a similar one in Maryland.

source : http://rss.nytimes.com/c/34625/f/640316/s/3b185e0e/sc/1/l/0L0Snytimes0N0C20A140C0A60C0A30Cbusiness0Cmassachusetts0Esues0Efannie0Eand0Efreddie0Eover0Eforeclosure0Elaw0Bhtml0Dpartner0Frss0Gemc0Frss/story01.htm

0n the Road: Boutique 1nns, Chain Hotels and the Business Traveler

NEW ORLEANS — WHEN I'm traveling on business, as I have been the past two weeks, I require the following in a hotel: a comfortable bed, a bathroom, reliable Wi-Fi, adequate space to work and a good location. And there have been times when reliable Wi-Fi was at the top of that list.

The Marriott Courtyard Iberville on the edge of the French Quarter, where I stayed for 13 nights, fit those requirements. I had a small suite with a couch and a desk, and I was as comfortable as anyone could reasonably expect to be when living in a big, busy hotel for two weeks. My room rate was about $200 a night.

If I wanted a "sense of place," a phrase of choice in the hotel industry these days, I could get it a block away, either downtown or on Bourbon Street. Downtown was a jumble of crowded hotels, fast-food joints and tourist shops along Canal Street. Bourbon Street has always struck me as a version of the boardwalk in Seaside Heights, N.J., without the charm and with far more alcohol.

Of course, you can find a far better sense of place within the French Quarter — and I did, at the Soniat House, whose owners describe it as "New Orleans's only small luxury hotel." The 31-room hotel, where I spent my first night here, is on relatively quiet Chartres Street.

It gave me the opportunity to compare two of the various types of accommodations available to business travelers. One, a big chain hotel, with all that entails in a tourist destination, including raucous wedding parties and college students trooping through the halls. The second, a small and quiet boutique hotel that has received rapturous reviews in glossy travel magazines — prominently displayed in frames on a wall in the Soniat House's ornate little courtyard.

I understand that many travelers prefer small hotels with personal service and a sense of place. But give me a quality chain hotel where I can expect consistency in rooms and amenities. When I am working on the road, local color is not high on the agenda.

Soniat House certainly has charm. The hotel, with its pretty interior courtyard, reminded me of the set from the most recent Broadway production I saw of Tennessee Williams's "Cat on a Hot Tin Roof." All it needed was Big Daddy bellowing off the balcony.

In this instance, though, he would have been hollering not about mendacity, but about the size of the room. Soniat House claims that its "superior" rooms are 225 square feet, but my windowless Room 26 ($277.85 for the night), reachable by poorly lighted wood stairs, seemed quite a bit cozier than that. Other observations: There was no place to use a laptop, which was less of an issue given the spotty Wi-Fi. The rug was shabby. The TV was smaller than my laptop monitor. And, hey, I remember those aged bathroom fixtures from what my grandmother used to call her country house.

"Room 26? Why, that's the tiniest room we have," Frances Smith, who owns the hotel with her husband, Rodney, said with tone of surprise when I called to ask about the accommodations. "Now, Room 27 next door? That's a great room. In fact, we're going to combine Room 26 and 27 to make a beautiful junior suite when we redo the hotel this summer."

That will be nice, I guess. But like I said earlier, consistency matters to the business traveler. And incidentally, many chain hotels provide that and a sense of place. Last year, my wife and I stayed in a Hilton Hampton Inn at the Zócalo in downtown Mexico City that was housed in a beautiful 18th-century monastery. The rooms were big and airy, the Wi-Fi worked perfectly and the free breakfast in the lobby was sumptuous.

As I said, Soniat House (which does not welcome children under 12, incidentally) gets great reviews. On Tripadvisor.com, the hotel has 128 reviews in the "excellent" and "very good" categories ("a beautiful, romantic and historic inn complete with a charming courtyard," says one from April), and just 24 reviews in the "poor" or "terrible" categories ("room the size of a closet with no windows and an unbearable musty smell," someone griped, also in April).

Mrs. Smith said that she and her husband did get business travelers as guests and had a meeting and reception room available for corporate events. "We're out there looking for business travelers," she said, adding: "I hate 'boutique,' which is the word for a store. I prefer 'inn.' "

But let's not be too hard on the boutique concept. Vivian Deuschl, a luxury hotel consultant formerly with the Ritz Carlton hotels, told me that the "boutique hotel" appellation has been overworked in recent years, especially by bed-and-breakfast-type inns trying to put on airs.

On the other hand, she said, female business travelers often seek both the "sense of place" and the privacy (including intimate dining) afforded by true luxury boutique hotels in major cities around the world, rather than the public commotion of chain hotels.

"By definition, a boutique should be no more than 100 rooms," she said. "Any place with an escalator is definitely not a boutique hotel. Many celebrities and C.E.O.s, especially women, prefer the quiet luxury of a boutique," even one operated (as many are now) by large hotel companies.

On the other hand, she said, "smaller is not always better."

source : http://rss.nytimes.com/c/34625/f/640316/s/3b17b14b/sc/10/l/0L0Snytimes0N0C20A140C0A60C0A30Cbusiness0Cboutique0Einns0Echain0Ehotels0Eand0Ethe0Ebusiness0Etraveler0Bhtml0Dpartner0Frss0Gemc0Frss/story01.htm

New Carbon Rules Unlikely to Start Energy Revolution

The new carbon pollution rules the Obama administration announced on Monday will help spur the natural gas industry and renewable energy like wind and solar power, but executives and analysts said they did not necessarily see an energy revolution in the making.

The intent of the Environmental Protection Agency proposal to slash carbon dioxide emissions is to reduce dependence on coal, which generates roughly 40 percent of the nation's electricity.

To achieve that goal, states will be given broad flexibility, meaning that reductions in coal use will come not only from relying more on other power sources, but also from making homes and buildings more efficient, both of which are already happening.

"I don't think it's a revolution because our carbon emissions are already going down because of cheap natural gas," said Michael Lynch, president of Strategic Energy and Economic Research, a consultancy. "It's not Obama's war on coal. It's reality's war on coal. Natural gas turns out to be better than coal in the marketplace."

And because states vary in their energy use, the local impact of the regulations will also vary.

Over all, consumers and industry may see their electricity rates rise over time because coal remains the cheapest power source, but those increases could be softened as demand falls with mandated efficiency improvements, energy specialists said. At the same time, improvements in technology are already reducing the costs of renewable energy, which have historically been higher than fossil fuels.

Changes for the economy and energy businesses are likely to be modest, at least in the short term, analysts said. In an investment note, FBR Capital Markets emphasized that the national carbon emissions reduction target of 25 percent by 2020 from 2005 levels, when carbon emissions were at their highest level before the recession, would actually mean a reduction of only 11.5 percent from 2012 levels. A 30 percent reduction from 2005 levels is mandated by 2030, and much of that could come from replacing the current housing and office building stock with new buildings constructed to meet improved local and state codes, which is already happening.

Energy specialists also note that past government shifts in policy, including stiffer efficiency standards for automobiles and appliances, have spurred innovation. Renewable mandates in states like California have not made a large impact yet on consumer costs, energy specialists say.

"States that intelligently capture this opportunity will cut their citizens' electric bills, and build a larger number of new clean energy companies," said Hal Harvey, chief executive for Energy Innovation, a consulting firm.

Business leaders said they would need time to read the fine print of the long E.P.A. draft, and they noted that there were sure to be years of lawsuits and negotiations between the federal government and states over compliance. But even before the draft was released and details began to emerge, many energy executives said they could live with a federal reset of carbon policy.

"At the end of the day, this is a call to open arms for natural gas and a big X against coal," said Chris Faulkner, chief executive of Breitling Energy, a Texas-based oil and natural gas exploration and production company with 22 percent of its production currently in gas.

Mr. Faulkner predicted that more gas generation plants would be needed to displace coal and meet new demand from population growth and that gas prices would rise perhaps as much as 25 percent. Gas prices have already risen over the last two years, but from historically depressed levels after the extraordinary boom in shale gas drilling that began around 2006.

A rebound in prices, Mr. Faulkner and other oil and gas executives say, probably will spur more drilling in several shale gas fields that are now nearly moribund. It will also accelerate the construction of gathering pipes in North Dakota and South Texas to collect excess gas from oil fields that is now being flared. More drilling should keep gas prices from spiking, they say.

"It's clear the increased use of natural gas in the existing power sector could create the opportunity for the U.S. to further capitalize on abundant North American natural gas supplies, furthering an energy renaissance, " said Marvin Odum, Shell Oil's president, in a statement.

The proposed rule also opens the door for nuclear power plant operators to collect extra revenue because their reactors do not generate carbon dioxide. The nuclear industry has long promoted its carbon-free nature, but thus far has not been able to collect cash for that attribute.

The rule lists the six reactors whose retirements have been announced since 2012, and takes note of estimates that an additional 5,700 megawatts — five or six reactors, depending on size, and about 6 percent of total nuclear capacity in this country — are threatened with retirement because of cheap natural gas.

Susan F. Tierney, an energy consultant and former assistant secretary of energy, said, "We know from analysis that if those plants were to retire, the cost to replace them with new generating capacity will be higher than to continue to obtain their zero-carbon output." She characterized the idea of paying extra for zero-carbon energy as "very light-handed."

Before the new regulations were released, Frank Prager, vice president for policy and strategy at Xcel Energy, a major Minneapolis-based electric company that operates across the Midwest and Rocky Mountain states, said the key to a successful plan was to give the states and utilities maximum flexibility to meet the goals, allow them time and offer them credit for past improvements. The E.P.A. plan does all three.

He noted that his company, which depends on coal for 46 percent of its power, had reduced emissions by 19 percent since 2005 and was on track to reduce its emissions by 31 percent by 2020. The company has already retired two coal plants in recent years and is retiring two more in the Denver area, replacing them with a combination of natural gas, wind and customer efficiency improvements. But he also noted that Xcel had reduced emissions in Colorado while building a new 750-megawatt coal unit in Pueblo.

"We think you can see significant reductions and still have coal in our system," Mr. Prager said. "Coal will be part of the mix for us in the future. It's really important from our perspective to have a balanced energy portfolio."

Despite the new rules, coal executives said they still saw a future even while older coal-fired plants are shutting down because of changing state regulations and because of rules that were already in place limiting mercury and air toxins.

Jim Orchard, Cloud Peak Energy's senior vice president for marketing and government affairs, said that last winter underscored the nation's reliance on coal, especially during periods of peak demand.

"At the end of the day the E.P.A. have their own priorities they need to meet," Mr. Orchard said before the release of the regulations, "but as well-informed folks they understand the need for the coal fleet to continue to run, or at least a substantial portion of it."

While acknowledging that the "coal fleet is in a bit of flux at the moment," he was confident in Cloud Peak's business of mining and selling coal from the Powder River basin region of Wyoming and Montana, where coal is economically mined and has a lower sulfur content than in other regions. He predicted that while there would a smaller number of coal-fired power plants in the future, some existing plants would potentially burn more coal to meet electricity demands.

That could mean more sales for Powder River basin and Illinois basin coal, while older mines in West Virginia and Kentucky may suffer because of higher operating and transportation costs.

"We are pretty happy with our place," Mr. Orchard said.

source : http://rss.nytimes.com/c/34625/f/640316/s/3b167b27/sc/1/l/0L0Snytimes0N0C20A140C0A60C0A30Cbusiness0Cenergy0Eenvironment0Cnew0Ecarbon0Erules0Eunlikely0Eto0Estart0Eenergy0Erevolution0Bhtml0Dpartner0Frss0Gemc0Frss/story01.htm

U.S. Factory Data Points to Pick Up in Growth

WASHINGTON, (Reuters) - U.S. manufacturing activity accelerated in May and construction spending rose for a third straight month in April, suggesting economic growth was regaining steam in the second quarter.

The economy sank in the first quarter under the weight of a brutally cold winter and a slow pace of restocking by businesses. But businesses appear to rebuilding inventories, with new orders at factories hitting a five-month high in May.

"It points to an acceleration in economic activity. We expect GDP growth to pick up meaningfully this quarter, with the pace of growth rising to around 4.0 percent," said Millan Mulraine, deputy chief economist at TD Securities in New York.

The Institute for Supply Management said on Monday its index of national factory activity increased to 55.4 in May from 54.9 in April. The ISM had earlier mistakenly reported the index fell to 53.2 in May. A reading above 50 indicates expansion.

There were gains in new orders, production and customer inventories, but factory job growth slowed. That suggests Friday's closely watched employment report could show a moderation in hiring in May from April's brisk 288,000 jobs.

The ISM survey also hinted at a pick-up in inflation pressures, with manufacturers reporting an increase in raw material prices.

MANUFACTURING FIRMING

The firmer manufacturing tone was corroborated by a separate report from financial data firm Markit. Markit said its final U.S. manufacturing Purchasing Mangers Index rose to 56.4 last month from 55.4 in April.

In a separate report, the Commerce Department said construction spending increased 0.2 percent in April to an annual rate of $953.5 billion, the highest level since March 2009.

While the increase was smaller than economists had expected, the spending figure for March was revised to show a 0.6 percent rise instead of the previously reported 0.2 percent advance.

"We anticipate that construction spending will continue to strengthen in the second quarter, more than making up for first-quarter softness," said Stephanie Karol, an economist at IHS Global Insight in Lexington, Massachusetts.

Investment in home building and nonresidential structures, such as factories and gas pipelines, contracted in the first three months of this year for a second straight quarter, helping to depress the economy, which shrank at a 1.0 percent annual rate.

Construction spending in April was led by public outlays, which rose 0.8 percent. Spending on both federal and state and local projects increased solidly, suggesting a long-running decline in public construction spending had bottomed.

Spending on private construction projects was flat. Still, private residential construction spending hit its highest level since March 2008.

(Reporting By Lucia Mutikani; Additional reporting by Rodrigo Campos in New York; Editing by Andrea Ricci)

source : http://rss.nytimes.com/c/34625/f/640316/s/3b145a76/sc/22/l/0L0Snytimes0N0Creuters0C20A140C0A60C0A20Cbusiness0C0A2reuters0Eusa0Eeconomy0Bhtml0Dpartner0Frss0Gemc0Frss/story01.htm

China’s Battle Against Google Heats Up

BEIJING — The Chinese authorities appear to have escalated their battle with Google in recent days, rendering almost all of the company's services largely inaccessible in the days leading up to the 25th anniversary of the crackdown on pro-democracy demonstrators in Tiananmen Square. In addition to the company's search engines being blocked, Google products including Gmail, Calendar and Translate have been affected.

Analysts say the unprecedented blocking of Google services is most likely related to the government's wide-ranging efforts to stifle discussion of the bloody crackdown that occurred in Beijing on June 3 and 4, 1989.

"This is by far the biggest attack on Google that's ever taken place in China," said a co-founder of Greatfire.org, an independent censorship-monitoring website, which published a blog post about the problems on Monday. "Probably the only thing comparable is when the Chinese government first started blocking websites in the 1990s."

While Internet users in mainland China could reach international versions of Google search until just a few days ago, "all Google services in all countries, encrypted or not, are now blocked in China," Greatfire.org said in the blog post. These include the Chinese-language version based in Hong Kong, Google.hk, as well as Google.com, Google Australia and others. Other services with no direct search function, including the company's Picasa photo program, Maps service and Calendar application, were also impossible to reach for most users on Monday. "It is the strictest censorship ever deployed," the blog said.

As most Internet users in China can attest, Google's services have been subject to varying degrees of interference since 2010, when the company shut down its Internet search service in China amid allegations of government censorship and intrusions by state-backed hackers. The move prompted angry denunciations by the Chinese government, but many young people responded by placing mourning wreaths at Google's headquarters in Beijing, a testament to the company's popularity here.

Since then, the company has been directing users to an uncensored search engine in Hong Kong.

The government has in the past denied that it interferes with Google services in China, but many users complain that accessing Gmail is difficult and at times nearly impossible.

The co-founder of Greatfire.org, who asked to remain anonymous to prevent retaliation by the Chinese authorities, said complaints had begun appearing on Chinese social media last week but had been quickly erased by censors.

"Sigh … my Google calendar is dead again," a user on the popular Sina Weibo microblog wrote Monday. "Every year it's sensitive, this year even more so." The post was swiftly deleted.

Unlike websites of Facebook, YouTube, Twitter and The New York Times, which are reliably blocked by the authorities, the recent disruption of Google services affects about 9 out of 10 Chinese users, according to Greatfire.org. By allowing some access, "the Chinese government is trying to pin the blame on Google," the Greatfire co-founder said.

Whether the blockage is permanent or just a temporary measure that will ease after June 4 remains unclear. Government offices in China were closed Monday for a national holiday, and Google could not be reached for comment.

In recent weeks, the Chinese authorities have waged a particularly aggressive campaign against those who might seek to discuss or commemorate the events of 1989, detaining dozens of dissidents, scholars and legal defenders. Some of those detained are facing criminal charges, a development that rights advocates say goes beyond previous efforts to stifle public commemoration of the crackdown. In an effort to foil online discussion, code words for the crackdown, including "6-4-89" and "May 35," have also been blocked.

"They're locking up everyone that they can and blocking everything they can," said Jeremy Goldkorn, director of Danwei, a website that tracks the Chinese news media and Internet.

This is not the first time Beijing has taken aim at Google and its users in China. According to Greatfire.org, the Chinese authorities blocked Google for 12 hours in 2012, using an attack known as Domain Name System Poisoning, which prevents the conversion of a domain name, like google.com, from being converted into its correlating numerical Internet Protocol address.

But even as the Chinese government continues to fortify its complex online censorship regimen, commonly known as the Great Firewall, software developers who support the free flow of information have been creating ever more innovative products that allow users to break through. Millions of people in China rely on proxy servers, virtual private networks and other methods to skirt Internet controls, although those measures are often subject to interference.

In March, Google began encrypting what is known as search by default in China. The secure system permits users to conduct uncensored searches, an act the government could prevent only by blocking direct access to Google. The authorities have now locked that electronic door, unless Internet users have the right software to pry it open.

Now there is at least one workaround safely protected in a place censors may find hard to reach: the cloud. The activists at Greatfire.org say they have developed an "unblockable" Google mirror website that relies on encrypted cloud computing. To take it down, the government would have to block online systems used by numerous companies in China — a move that would very likely have significant economic repercussions.

source : http://rss.nytimes.com/c/34625/f/640316/s/3b150158/sc/21/l/0L0Snytimes0N0C20A140C0A60C0A30Cbusiness0Cchinas0Ebattle0Eagainst0Egoogle0Eheats0Eup0Bhtml0Dpartner0Frss0Gemc0Frss/story01.htm

DealBook: Marathon 0il Sells Norwegian Unit for $2.1 Billion

Marathon Oil, via Associated PressMarathon Oil has been under pressure to trim its overseas activities and invest more in the United States.

LONDON – The exploration and production company Marathon Oil said on Monday that it would sell its North Sea oil business in Norway to a Norwegian oil producer for $2.1 billion in cash.

Marathon, based in Houston, also said it had called off the sale of its British business after failing to receive what it deemed an acceptable offer.

The Norwegian sale, to Det Norske Oljeselskap, is the latest move in an effort by Marathon to streamline its portfolio of assets.

Like other midsize American oil companies, Marathon has been under pressure to trim its overseas activities and invest more in the United States, where oil and gas production is booming. Investors also worry about political risk outside the country.

Marathon's sale of Norwegian assets is the latest milestone in the company's effort to refocus its activities. Since 2011, Marathon has agreed asset sales worth $6.2 billion, including the sale of a $1.5 billion stake in an Angolan oil field last year.

Marathon is putting the money from the sales into a combination of American shale oil investments and share buybacks.

"The disciplined allocation of capital to opportunities that can deliver long-term growth at higher returns and improved margins is a strategic imperative," Lee M. Tillman, the president and chief executive of Marathon, said in a statement.

The sale announced on Monday includes a floating production, storage and offloading vessel operated by Marathon as well as various production licenses in the North Sea, Marathon said. In 2013, its production in Norway averaged the equivalent of about 80,000 barrels of oil a day.

Det Norske said the transaction would complement its planned production in the Ivar Aasen and Johan Sverdrup fields in the North Sea and that it would have about 200 million barrels of oil equivalent in proven reserves and probable deposits after the transaction.

The deal is subject to regulatory approval and is expected to close in the fourth quarter.

Det Norske's strategy has been to create a strong Norwegian exploration and production company, said Sverre Skogen, the Det Norske chairman. "With this transformational transaction we have achieved our goal well ahead of schedule."

Production has been slowing in the North Sea, although to a greater extent in British than in Norwegian waters.

The Norwegian oil and gas industry has had considerable success moving north and making new finds, although this direction is raising increasing concerns about the potential to damage sensitive environments.

The 80,000 barrels of oil equivalent production that Marathon is selling is only a tiny portion of overall Norwegian output.

American companies like the Apache Corporation, based in Houston, and the Hess Corporation, based in New York, also have been putting assets on the block to reduce overseas exposure and raise money for investment at home.

In April, for instance, Hess said it was selling its interests in two Thai fields to PTT Exploration and Production of Thailand for $1 billion. Last year, Hess sold assets in Indonesia for $1.3 billion and in Russia for about $2 billion.

Earlier this year, Apache sold its Argentine business for $800 million. Last year, it bowed to investor complaints about the riskiness of its very profitable Egyptian business and sold about a third of its operations there to Sinopec of China for about $3 billion.

Marathon had also been seeking to sell its British North Sea business but it said on Monday that it had "received no acceptable offer" for these stakes and so would retain them.

With so much for sale, it may be growing difficult to find buyers.

This post has been revised to reflect the following correction:

Correction: June 2, 2014

Because of an editing error, an earlier version of this article misspelled the name of a Norwegian company. It is Det Norske Oljeselskap, not Det Norske Oljeselskapis.

source : http://rss.nytimes.com/c/34625/f/640316/s/3b106f94/sc/2/l/0Ldealbook0Bnytimes0N0C20A140C0A60C0A20Cmarathon0Eoil0Eto0Esell0Enorwegian0Ebusiness0Efor0E20E10Ebillion0C0Dpartner0Frss0Gemc0Frss/story01.htm

Cancer Researchers Report Longer Survival Rates With 1mmunotherapy

CHICAGO — Drugs that unleash the body's immune system to combat tumors could allow patients with advanced melanoma to live far longer than ever before, researchers gathered at the nation's largest cancer conference say.

"It's a completely different world for patients with metastatic melanoma, to talk about the majority of patients being alive for years rather than weeks or months," said Dr. Jedd D. Wolchok, a melanoma specialist at the Memorial Sloan-Kettering Cancer Center, interviewed at the annual meeting of the American Society of Clinical Oncology here.

The treatments, called immunotherapy, generated a huge stir at last year's annual meeting, with some doctors predicting a revolution in cancer care.

Immunotherapy has also set off a frenzy in the pharmaceutical industry, with Bristol-Myers Squibb, Merck and Roche racing to bring drugs to market. Close behind is AstraZeneca, whose work was a major reason behind Pfizer's recent unsuccessful bid to buy that company. Many other drug companies are now scrambling to get a piece of what could become a market worth tens of billions of dollars a year in sales.

At this year's cancer meeting, which is underway here, there are not as many astonishing new results being presented. Some of the findings being highlighted simply involve longer follow-up of patients from the same studies presented last year.

The new results show the effects of the drugs can last for a long time. And there is now initial evidence that drugs work on a growing number of types of cancer.

But there are grounds for caution. The results are mainly from small studies that lack control groups for comparison. The medicines work for only a minority of patients. And in some cases the drugs are causing frequent or severe side effects. That seems to be especially true when two immune-boosting drugs are used in combination, something that might be necessary to achieve maximum effectiveness.

The power of a combination was shown in advanced melanoma, a deadly skin cancer. In one clinical trial, 79 percent of patients receiving two immunotherapy drugs from Bristol-Myers were alive after two years. Of those who received the optimal dose, the two-year survival rate was 88 percent.

Dr. Wolchok, who was involved in the study, said that only several years ago, the two-year survival rate for metastatic melanoma may have been less than 10 percent. One of the immune drugs, Yervoy, which was approved for use against melanoma in 2011, allows for a two-year survival rate of about 25 percent when used alone, he said. The other drug, nivolumab, which is still experimental, had a two-year survival rate above 40 percent range when used alone.

The drugs block the actions of proteins that act as brakes on the immune system, preventing them from attacking the tumors. Yervoy, also known as ipilimumab, releases the brake known as CTLA-4. But the main interest is in nivolumab and similar drugs coming from Merck, Roche and AstraZeneca that release a brake called PD-1.

Merck could win approval from the Food and Drug Administration to sell its drug as a melanoma treatment by this October. Some 69 percent of patients using the drug, called pembrolizumab or MK-3475, survived one year, according to new results of a 411-patient trial presented Monday. It is too soon to know how many will live two years.

But unleashing the immune system can also lead to dangerous side effects, including colitis, a serious inflammation of the colon, as well as problems with the liver, thyroid and pituitary glands.

When Bristol-Myers tested its two drugs together as a treatment for advanced lung cancer, about half of the 46 patients suffered serious side effects, and three of them died from the drugs themselves, according to an abstract of a study being presented here.

The side effects could be a barrier to using the drugs for less advanced stages of disease.

Results released here Monday show that Yervoy, which is now approved to treat melanoma that has spread beyond the skin, was also effective against melanoma confined to the skin and lymph nodes that could be surgically removed. Three years after surgery, 46.5 percent of patients who received Yervoy remained free of disease, compared with only 34.8 percent of those receiving a placebo.

However about half the 471 patients who started taking Yervoy discontinued treatment because of side effects and five of them died from those side effects.

To be sure, the dose of Yervoy used in that trial was far higher than the dose approved for metastatic melanoma. Pharmaceutical executives and medical specialists say the side effects of the immune drugs are different from those of traditional chemotherapy and doctors have been unprepared. But now they are learning to mitigate them.

"If you see colitis and you've never seen it before, you'll freak out," said Dr. Padmanee Sharma, scientific director of the immunotherapy program at the M.D. Anderson Cancer Center in Houston. She said that the older chemotherapy drug cisplatin was also once considered so toxic it would never be used. Now, she said, "We give cisplatin like water."

Besides melanoma, the drugs are known to work against lung and kidney cancers. Bristol-Myers is applying to the F.D.A. for approval to sell nivolumab as a last-ditch treatment for advanced lung cancer.

But at this meeting there were signs that the drugs that block the action of PD-1 might also work for bladder cancer, head and neck cancer, and ovarian cancer.

In a small study, Roche's drug, known as MPDL3280A, shrank tumors in 43 percent of a subset of patients with advanced bladder cancer. The company might now make bladder cancer the priority for its first approval rather than lung cancer, Daniel O'Day, head of Roche's pharmaceutical business, said in an interview here.

The subset consisted of patients whose tumors produced a protein called PD-L1, which binds to PD-1 on immune system cells and thereby shuts down those cells. Companies are exploring whether a PD-L1 test can be used to determine which patients should get the drugs.

But in Roche's study, 11 percent of the bladder cancer patients whose tumors did not make a lot of PD-L1 also experienced tumor shrinkage. "If you're that patient, it is unethical not to offer it," said Dr. Parma.

Researchers are also trying to learn why only some types of cancers can be treated with these drugs. One reason could be that other cancers stifle the immune system by means other than PD-1.

"It's hard to believe that a single checkpoint is going to be important in every cancer," said Dr. Mario Sznol, a professor of medicine at Yale, using a technical term for the immune system brakes.

Companies are developing inhibitors of other checkpoints as well as other types of drugs to direct the immune system to attack tumors. Roche by itself is developing 20 immunotherapy drugs, Mr. O'Day said. And the immunotherapy drugs are being tested in combination with one another and with more conventional drugs as well.

Some experts note that there was initially huge excitement about so-called targeted therapies and about drugs that block the flow of blood to tumors. While those approaches have made a difference, they have not been the panaceas enthusiasts envisioned, and that is likely to be the case with immunotherapy as well.

"With anything, all that glitters is not gold," said Dr. Richard Pazdur, who as chief of the cancer division at the F.D.A. has a unique insight into how drugs are performing. He said he was not allowed to discuss specific drugs.

source : http://rss.nytimes.com/c/34625/f/640316/s/3b11ddfc/sc/14/l/0L0Snytimes0N0C20A140C0A60C0A30Cbusiness0Ccancer0Eresearchers0Ereport0Elonger0Esurvival0Erates0Ewith0Eimmunotherapy0Bhtml0Dpartner0Frss0Gemc0Frss/story01.htm