Biotech is a constant stream of information. And the average investor does not have the time or the energy to keep up. More importantly, it can be very tough to put the news into context when you’re talking about these big events. My daily article series on Seeking Alpha is designed to provide readers with insight and leads for new biotech investment opportunities that they may not catch through traditional news channels. Every day, I take 3 events of interest and offer a description and commentary for readers.
But here at Invest Against Cancer, I’m moving a little bit deeper. Part of that is offering readers actionable advice, specifically in cancer stocks. So “Highlights” focuses on the cancer news from the week and provides more advice. Let’s get started!
The May 21 edition of “3 Things” focused largely on non-cancer diseases, including a nod toward expanded approval for Novartis’s drug canakinumab (branded Ilaris). But there was one piece of news relating to prostate cancer in particular. Inovio Pharmaceuticals announced that they would be presenting a poster at ASCO detailing results from an ongoing phase 1b trial.
The study focused on INO-5150, a DNA vaccine targeting prostate-specific antigen (PSA) and prostate-specific membrane antigen (PSMA). This is geared toward training the immune system to detect and fight prostate cancer. Inovio divulged that 38% of the patients who had T-cell reactivity from the vaccine also had a slower rise in PSA compared with patients with no reactivity.
Why is this important? In prostate cancer management, the standard treatment is removal or suppression of the prostate. This shuts down production of PSA. In some cases this is the end of the cancer. However, if the cancer cells start to grow back, they will begin to produce more PSA. So by watching for elevation of this biomarker, doctors can determine if the patient will eventually relapse well before the tumor is detectable.
And a lot of therapies are geared toward preventing or slowing down this “biochemical” relapse. So a slowdown of PSA increase in this case likely means that the vaccine is helping to suppress prostate cancer growth.
It is worth noting, however, that the study was not powered for efficacy. So I wasn’t surprised that Inovio announced that the slowdown in PSA rise was only barely significant.
And it also explains why the news did not have a heavy impact on Inovio’s chart:
Clearly, this was not a big item for current outlook. However, I look at this as more of a long-term proposition, one with pretty high risk. Inovio is not depending on this particular program for its current pipeline, but if they can see it through to approval, it could make a huge difference to the field. With a few exceptions, immunotherapy has not really made much impact on the field of prostate cancer management.
On May 22, I focused more on cancer. In particular, Immunomedics announced that they submitted their new drug application for sacituzumab govitecan in triple-negative breast cancer. This is important for several reasons. First, triple-negative breast cancer is a major unmet need. The field desperately needs new treatment options. Second, Immunomedics does not yet have a drug approved. This is their opportunity to make that binary transition from “clinical-stage” to “commercial” biotech.
Finally, sacituzumab govitecan was once the subject of a licensing agreement for Immunomedics. But this was terminated abruptly last year. Clay Siegall, the CEO and President of Seattle Genetics, commented at the time:
The Immunomedics transaction would have effectively utilized our substantial expertise in antibody-drug conjugate (ADC) development to advance IMMU-132 for patients in need. However, due to significant delays and lack of progress towards closing the deal, we are turning our full attention and resources to our promising pipeline and the substantial opportunities in front of us…
This makes it sound most like Seattle Genetics was the driver of terminating the arrangement. And here we are one year later, and Immunomedics looks poised for approval. I would count that as a missed opportunity for Seattle Genetics, given their struggles to move beyond brentuximab vedotin (branded Adcetris). I covered this struggle in more detail earlier this year on Seeking Alpha.
For Immunomedics, an approval here would mean potentially capturing upwards of 17% of the entire breast cancer market. Currently, there is very little in the way of options for the triple-negative subgroup. So it’s little surprise that the company has continued to grow in value. Now, they are sitting at just shy of $4 billion, and I would expect this to continue if signs point to approval for sacituzumab govitecan.
The May 23 edition of 3 Things focused largely on gene therapy. In particular, Spark Therapeutics showed incredible early data in hemophilia. The only cancer news from that day was Aileron Therapeutics, who published preclinical findings in Nature Communications. They tested their drug, ALRN-6924, in models of lymphoma. And the findings show that their stapled peptide drug could effectively reactivate p53 suppression of tumor growth.
To be clear, this is not quite actionable news just yet. That is hopefully coming in the near future, with the primary completion date for their phase 1/2 study having passed in January. This study has not been updated since July of last year, but it’s possible that we’ll see results in 2018. For lymphoma, it seems to me that the most likely venue will be ASH. But what do I know?
But the reason this study excites me is because of the target: p53. It was one of the first tumor suppressors identified in cancer, working to stop cell growth when there are mutations. But the problem is that it doesn’t have any enzymatic activity. It works by binding another protein called Mdm2. Thus, for decades scientists considered this protein undruggable. But ALRN-6924 could be a step in the right direction, and I’m now very curious to see what the clinical study has in store for this agent.
In the meantime, the markets didn’t really react to this news, and Aileron Therapeutics continues to sit at a market cap under $100 million, continuing a long slide from a high of $15 per share in October 2017. I think this company might be a potential high-risk opportunity that you should pay attention to. Any news of positive clinical findings could make a big difference in company valuation.
The big cancer news covered in on May 24 was the announcement that Merck’s drug pembrolizumab (branded Keytruda) improves overall survival and progression-free survival in squamous cell non-small cell lung cancer when added to chemotherapy. This mirrors the findings that led to initial approval for the pembrolizumab-chemtherapy combo in non-squamous cell disease.
And to be fair, non-squamous disease is generally the hotter ticket. It represents most of the cases of non-small cell lung cancer. But the upside is that there are a lot more treatment options. In squamous cell disease, patients cannot receive bevacizumab (branded Avastin), and they are not candidates for the same types of chemotherapy. Before the approval of nivolumab (branded Opdivo) in 2015, patients had chemotherapy, and that was it. There were no targeted therapies, unlike in non-squamous disease.
So this finding is a major coup for Merck. It sets a new standard for first-line management of squamous cell lung cancer. We don’t yet know just how well the combo performed. However, I can practically guarantee that the combination of pembrolizumab and chemotherapy will be approved now.
The end result is likely going to be that Merck is able to continue growing, since it has shown few signs of slowing down development of pembrolizumab. This may end up trumping Bristol-Myers, who have dominated the immunotherapy game by being the first to bat. But where nivolumab has struggled to make inroads, pembrolizumab has succeeded mightily, and analysts now think that it will exceed nivolumab in earnings in the near future. And when I think about just a few years ago, Merck was the also-ran. Their drug required a PD-L1 test, killing their chances. They were basically in the same indications as Bristol-Myers. They could not set themselves apart.
It’s very interesting how quickly things can change!
The biggest news in biotech on this day’s edition was that AbbVie’s ibrutinib (branded Imbruvica) was an effective combination partner with obinutuzumab in first-line chronic lymphocytic leukemia (CLL). This is an important study, since obinutuzumab-chlorambucil has been a standard “less intense” option for frail patients since the publication of its phase 3 study in 2014.
Now, AbbVie may supplant this combination, but with a chemotherapy-free regimen. And chlorambucil can cause potentially deadly side effects like bone marrow suppression, so this could be a big deal.
What this marks is a continued infiltration of AbbVie’s roots into CLL treatment. First, they own ibrutinib in the first place, which is already a standard treatment option across much of the treatment landscape. Then, their Bcl-2 inhibitor venetoclax (branded Venclexta) has crushed Gilead’s idelalisib (branded Zydelig), which causes liver damage and infections. So now it seems that AbbVie will even be able to replace chemotherapy in the near future, at least for those patients who are too unhealthy for standard regimens.
But we should not discount the age factor here. CLL is definitely a disease of the later years, with only between 5% and 11% of patients falling under the age of 55. As a result, it’s likely that these findings will lead to approval and increased market share for ibrutinib, which is critical because of increasing competition from the likes of Verastem, AstraZeneca, and TG Therapeutics.
So we are seeing some critical developments come out of this week’s edition. In particular, these new combos are going to change their respective cancer treatment settings. Both Merck and AbbVie are now poised to build upon their dominance in lung cancer and CLL, respectively. I fully expect submissions to the FDA on the basis of these data in the near future, so you should watch for that. Importantly, however, these announcements indicate to me strong buy signals. But you should be cautious when taking one piece of news from these big companies, since they have so many moving parts.
Like what you read? Follow me on Seeking Alpha to receive daily updates and see articles I don't write anywhere else. Just click the button below!