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Optimistic for OncoMed's Future

By: Meital Gabay Ph.D., Alan Leung, Andy Chang, and Mei-Hsin Cheng

OncoMed Pharmaceuticals (NASDAQ:OMED) is a development stage biotech company that focuses on discovering and developing monoclonal antibody therapeutics that target cancer stem cells (CSCs). OncoMed recently had its IPO on July 18th in which it sold 4.8 million shares at $17 each [1]. OncoMed currently has five products in Phase 1 Clinical Trials [2]. Though many of OncoMed's products are still in development, they already have two partnerships with GSK and Bayer [3].

OncoMed is well positioned. Monoclonal antibodies are more likely to receive FDA approval. In a study from Tufts University, large molecules of which monoclonal antibodies made up the largest group at 47%, had an average approval rate of 32%, while small molecules had a much lower approval rate of 13% [4,5]. OncoMed's management team also includes Jakob Dupont who was the Global Medical Director for Avastin (bevacizumab) at Genentech [6].

Targeting cancer stem cells directly is an emerging field in biotechnology. Currently, OncoMed's two main competitors in the cancer stem cell industry are Stemline Therapeutics Inc and Verastem Inc. Verastem develops small molecule drugs that target cancer stem cells. To find their drug targets, Verastem uses high-throughput screening of compound libraries in cancer stem cells. One of the drawbacks of screening in CSCs is that CSCs are not stable in culture.

Stemline targets both CSCs and tumor bulk, to identify their targets Stemline has two of their own platform technologies: StemScreen-1 and StemScreen-2. They use StemScreen-1 to identify targets based on gene expression analyses on CSCs isolated from primary tumor tissue and cell lines. StemScreen-2 is a high-throughput platform that tests live, labeled CSCs in their native environment.

Company

Enterprise Value (million)

Most Advanced Product

Clinical Trial Status of Most Advanced Product

OncoMed

$450

Demcizumab (anti-DLL4)

Phase 1b for lung cancer in combination with other chemotherapy drugs. Starting Phase 1b/2 trials in ovarian and pancreatic cancers. Some adverse cardiovascular effects.

Verastem

$250

Defactinib (FAK inhibitor)

In Phase 1 dose trial in combination with paclitaxel. 1 out of 6 patients had a complete response. Phase Ib ongoing.

Stemline

$386

SL-401* (IL-3 linked to diphtheria toxin) and SL-701 (vaccine against IL-13R and EphA2)

Both Phase 1 and 2. SL-401: 1 cycle has improved median overall survival by more than three fold.

SL-701: 19/22 patients had tumor reductions or disease stabilization.

*SL-401 is being developed for orphan indication

Information from table [6].

Wnt Pathway Drugs: OMP-18R5 and OMP-54F28

OncoMed currently has two product candidates that target the Wnt pathway: OMP-18R5 (Anti-Fzd7, vantictumab) and OMP-54F28 (Fzd8-Fc). OMP-18R5 and OMP-54F28 have both entered Phase I clinical trials to determine safety, pharmacokinetics, immunogenicity and preliminary efficacy of the drugs.

OMP-18R5 is a fully human monoclonal antibody that binds a conserved epitope that is on five Frizzled receptors and inhibits Wnt signaling. In a first-in-human trial, OMP-18R5 has been tolerable with limited side effects. The most common treatment-related side effects were fatigue, nausea, altered taste, vomiting, increased alkaline phosphatase, constipation, decreased appetite, increased blood pressure, hypercalcemia and peripheral edema [2,6,7]. OMP-18R5 has single-agent activity in patients with neuroendocrine tumors. It is expected to enter three Phase Ib combination trials this year. It binds to key Fzd receptors and prevents the activation of the Wnt signaling pathway. In mouse xenograft studies, OMP-18R5 inhibits the growth of a range of tumor types and exhibits synergistic activity with standard-of-care chemotherapeutic agents [8].

OMP-54F28 is a proprietary fusion protein based on a truncated form of the Frizzled8 receptor (Fzd8). For OMP-54F28 , no clinical data has been reported yet. OMP-54F28 acts as a "decoy receptor" and functions by sequestering Wnts so that they are unable to bind to Frizzled receptors. OMP-54F28 has shown evidence of anti-tumor activity and reduction of CSC frequency in multiple preclinical models either as a single agent or when combined with chemotherapy [9].

OncoMed is still actively recruiting patients for both OMP-18R5 and OMP-54F28. Specifically, they are recruiting patients with histologically confirmed malignancies that have no standard curative therapy with a demonstrated survival benefit. OncoMed is also planning to report data for Phase I this year and to initiate three Phase Ib clinical trials in late 2013 or early 2014 in distinct tumor types in combination with standard-of-care therapies.

Four drugs targeting Wnt signaling have reached clinical trials. Two of these compounds are biologics developed by OncoMed (OMP-18R5 and OMP-54F28). The other two small-molecules are developed by Prism Pharma and Novartis (see table 1). It is not surprising that there are several drugs in development targeting the Wnt pathway because the Wnt pathway is known to be inappropriately activated through frizzled receptors in many major tumor types, including colon, breast, liver, lung and pancreatic cancers, and is critical for the function of cancer stem cells (CSCs). High-throughput screens have been used extensively to identify small-molecule targeted inhibitors of different Wnt pathway components. This work was proven useful in cell-based assays, but translation into the clinic has remained difficult due to the potential off-target effects.

OncoMed has chosen to target Wnt pathway with biologics. OMP-18R5 and OMP-54F28 block Wnt ligand recognition. Preclinical evidence has been encouraging so far. Since Wnt pathway is so important in the maintenance of tumor-initiating cells, inhibition could ultimately target cells that are resistant to traditional chemotherapy.

OMP-18R5 and OMP-54F28 are both being developed by OncoMed with a partnership with Bayer. OncoMed and Bayer are developing three biologics and two small molecules that target the wnt pathway. Bayer gave OncoMed $40 million in cash payment in exchange for the rights to exercise an option for an exclusive license to develop and commercialize biologics they discover Phase I trials [3]. OncoMed has the potential to recieve #387.5 million for each biologic therapeutic upon reaching milestones. The royalty percentages for OncoMed range from the high single digits to the high teens depending on the drug.

Table 1 - Wnt-Targeting Compounds in Development (Adapted from Emma Hitt, OncLive, January 7, 2013)

Drugs

Description

OMP-18R5

(OncoMed Pharmaceuticals/Bayer)

Monoclonal antibody targets the Frizzled receptors to block association with Wnt ligands.

OMP-54F28

(OncoMed Pharmaceuticals/Bayer)

Fusion protein of the Frizzled8 ligand-binding domain with the Fc region of a human immunoglobulin. It binds and sequesters soluble Wnt ligand, impairing its recognition by receptors on tissues.

PRI-724

(Prism Pharma Co, Ltd/Eisai)

Small-molecule inhibitor of the interaction between β-catenin and CBP. Disrupting the interaction prevents activated transcription by aberrant Wnt signaling at many levels.

LGK974

(Novartis Pharmaceuticals)

Small molecule that inhibits acyltransferase porcupine. Inhibiting porcupine can be a small-molecule-based method for inhibiting Wnt ligand-mediated activation.

Anti-Notch 2/3: OMP-59R5

OMP-59R5 (Anti-Notch2/3) is a fully human monoclonal antibody that targets the Notch2 and Notch3 receptors. A single-agent Phase I trial in advanced solid tumor patients has been completed. Phase Ib/II trials for pancreatic cancer and small cell lung cancer are ongoing.

Data from Phase I in advanced solid tumor patients is encouraging. Intravenous administration of OMP-59R5 to patients with advanced solid tumors was well tolerated and maximum tolerated doses were established. The most frequently reported drug-related adverse events were: mild to moderate diarrhea, fatigue, nausea, vomiting, decreased appetite, and constipation. Diarrhea was dose related and appeared less pronounced with every-other-week dosing [10]. Data for the Phase I trial were presented at the ASCO Annual Meeting in Chicago, June 2012, as well as at the 24th EORTC-NCI-AACR Symposium on Molecular Targets and Cancer Therapeutics in Dublin, Ireland, in November 2012.

OMP-59R5 is currently enrolled in two Phase Ib/II trials. One was initiated for pancreatic cancer patients in July 2012. The trial is still recruiting patients with stage IV ductal adenocarcinoma of the pancreas. They are looking for the highest dose of OMP59R5 that can be given safely with the standard chemotherapy for advanced pancreatic cancer (gemcitabine and Nab-Paclitaxel).

The second Phase Ib/II trial is in small cell lung cancer and was initiated earlier this year (May 2013). This trial is still recruiting patients with histologically or cytologically documented extensive stage small cell lung cancer. The purpose of the study is to find the highest dose of OMP59R5 that can be given safely with the standard chemotherapy for extensive stage small cell lung cancer (Etoposide and Cisplatin). Both trials also test potential predictive biomarkers to identify patients that may derive the greatest benefit from OMP-59R5.

OMP-59R5 is a fully human IgG2 monoclonal antibody. The antibody binds to a conserved epitope on Notch2 and Notch3 and inhibits the signaling of both receptors. The Notch pathway plays a central role in embryonic development, the regulation of stem and progenitor cells, and is implicated centrally in many human cancers.

Based on preclinical experiments, it seems that OMP-59R5 could be a novel anti-cancer agent that inhibits tumor growth. OMP-59R5 is being developed by OncoMed with a partnership with GSK. OncoMed can receive $344.5 million for OMP-59R5 for reaching milestones and a royalty percentage in the low to high teens. GSK has the option to obtain an exclusive license to develop and commercialize OMP-59R5 through proof-of-concept completion.

Demcizumab:OMP-21M18

Demcizumab (OMP-21M18) is a humanized antibody against the delta-like ligand 4 (DLL4), a ligand in the Notch signaling pathway. Targeting DLL4 attacks cancer via multiple mechanisms. DLL4 inhibits CSC growth and promotes cell differentiation, while disrupting angiogenesis (which provides blood vessels to allow for tumor growt.h)

Anti-DLL4 antibodies have shown great promise for treating cancer, with results published in several big impact papers [11,12]. These papers showed that anti-DLL4 therapy inhibited the growth of multiple tumor models, including ones resistant to anti-VEGF therapy, a strategy used by clinically approved antiangiogenic drugs such as Avastin. While these animal studies are very promising, it is well known that animal models do not always correspond to actual human disease, so it is important to see how this drug behaves in the clinic.

In addition to demcizumab, OncoMed is developing an anti-DLL4/anti-VEGF bispecific antibody, and preclinical studies have shown that it can potentially be more efficacious than anti-DLL4 or anti-VEGF alone. This molecule is expected to move into the clinic in 2014.

OncoMed completed a single-agent Phase Ia trial with demcizumab in advanced solid tumor patients in 2011. Two Phase Ib combination trials with demcizumab are currently being conducted to treat pancreatic cancer and non-small-cell lung cancer (NSCLC). In addition, a Phase Ib/II trial focused on ovarian cancer is planned for the second half of 2013, and a Phase Ib trial targeting colorectal cancer that was initiated in 2010 was closed based on prioritization of resources. These trials pair demcizumab with standard-of-care treatments including gemcitabine and Abraxane® for pancreatic cancer, carboplatin and pemetrexed (Alimta®) for NSCLC, and paclitaxel for ovarian cancer.

Side effects seen in Phase Ia included hypertension (high blood pressure) and cardiovascular events (pulmonary hypertension or heart failure) for dosing longer than 100-150 days [6]. Others included fatigue, anemia, diarrhea, headache, nausea, hypoalbuminemia, blood pressure increase, dizziness, and dyspnea. In Phase Ib when combined with chemotherapy, side effect included fatigue, nausea, vomiting, hypertension, neutropenia, decreased appetite, increased BNP levels, pulmonary hypertension, thrombocytopenia, diarrhea, peripheral edema, anemia, dyspnea, constipation, increased alanine aminotransferase, and rash.

There are currently two other anti-DLL4 drugs in the clinic: enoticumab from Regeneron and Sanofi and MEDI0639 from MedImmune, which are also monoclonal antibodies against DLL4. Both of these molecules lag behind OncoMed's demcizumab and are only in single agent Phase I studies. OncoMed projects spending approximately $18.0 to $25.0 million from its IPO proceeds for clinical expenditures to advance demcizumab through Phase II clinical trials.

References:

1. Timmerman, L. "OncoMed Pharmaceuticals Soars in IPO Debut." Xconomy. July 18, 2013.

2. Oncomed.com/pipeline.html

3. Wei, T and Deepak, S. "OncoMed Initiating Coverage." Equity Research Americas. Aug 12, 2013.

4. Becker, M. "Monoclonal Antibody Companies Command Premiums." Seeking Alpha. Jul 12, 2010.

5. DiMasi, J, et al. "Trend in Risks Associated with New Drug Development: Success Rates for Investigational Drugs." Clinical Pharmacology and Therapeutics. Feb 3 2010.

6. OncoMed SEC Filing.

7. clinicaltrials.gov

8. Gurney, A. et al. "Wnt pathway inhibition via the targeting of Frizzled receptors results in decreased growth and tumorigenicity of human tumors", Procof Natl Acad Sci, Jul 17, 2012; 109(29):11717-22

9. OncoMed press release, July 12, 2012; Zach Hartman, AACR conference report, April 11, 2013.

10. OncoMed press release, ASCO, June 6, 2012

11. I. Noguera-Troise et al. "Blockade of Dll4 inhibits tumour growth by promoting non-productive angiogenesis." Nature, 444 (2006), pp. 1032-1037.

12. J. Ridgway et al. "Inhibition of Dll4 signalling inhibits tumour growth by deregulating angiogenesis." Nature, 444 (2006), pp. 1083-1087.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

Source: Optimistic For OncoMed's Future