New Technology Puts Actinium On The Radar

There is no shortage of intriguing technology out there

For the following reasons, I have recently developed an interest in a cancer drug research company called Actinium Pharmaceuticals (NYSEMKT:ATNM).

  1. They have a very new and cutting-edge technology
  2. They are targeting hematologic cancer patients that have few options
  3. Products are far into clinical development
  4. The association with Memorial Sloan-Kettering Cancer Center

While there are a lot of companies that have promising hematologic cancer drugs in clinical development, Actinium stood out to me primarily because of the platform technology that their therapies are based on. This technology was co-developed with Memorial Sloan-Kettering - a prestigious hub for cutting-edge cancer research and treatment.

"Directing" the power of Alpha Radiation

In addition to chemotherapy, oncologists often use radiation therapy to weaken and destroy cancer cells. The type of radiation used is known as Beta Radiation, and the rays are actually just electrons and positive electrons (positrons) flying at a high speed. These particles kill cells that they interact with, and can also penetrate deeply into the body because of their small size. Many types of cancer cells are much more susceptible to destruction via radiation, which is why Beta Radiation remains very popular.

However, there are two major problems with Beta Radiation. First is its tendency to destroy a lot of non cancer afflicted cells, which makes it dangerous for patients whose bodies cannot tolerate it. Second is the tendency for radiation-resistant cancer cells to grow back following remission.

This is a huge problem that currently has no solution, although Actinium's strategy looks promising. The Alpha Particle Immunotherapy platform uses a higher energy type of radiation - Alpha Radiation, which consists of two neutrons and protons with a strong positive charge flying at a high speed. Alpha Radiation penetrates less tissue, although the rays are heavier and contain much more energy. For a rough comparison: imagine the Alpha particle as four adult-sized bowling balls, glued together, flying through space. Then imagine a Beta particle as a ping pong ball flying at ten times the speed. While the ping pong ball can cause damage, the bowling balls are much more intimidating.

Alpha Radiation is definitely more potent, but it's much harder to use in cancer patients because of its short range in the body and its overly strong cell-killing capacity. The only solution is to direct the radiation towards only cancerous cells - but how can this be accomplished?

Antibodies.

Actimab-A and Iomab-B

The two most mature products in the pipeline are Actimab-A and Iomab-B, which are both based on Alpha Radiation that is "directed" by a monoclonal antibody. Basically, these drugs consist of two connected parts: a targeting/antibody portion and a radioactive portion. The targeting portion is just an antibody that matches antigens associated with specific types of cancer, while the radioactive portion has an isotope that emits alpha radiation. Actimab uses Actinium-225 and Iomab uses Iodine-131.

The antibody used in Actimab-A is used to target antigens that are closely associated with myeloid leukemia cells, which makes it a new possible treatment option for acute myeloid leukemia (AML) patients that fail chemotherapy and other primary therapies.

Iomab-B is actually quite different, and is being designed as a drug to prep patients for an allogeneic bone marrow transplant. These types of transplants use bone marrow from someone other than the patient, and requires careful preparation to avoid potentially fatal graft-versus-host disease (GvHD). The antibody used for Iomab-B targets all the blood cells that have to be destroyed for a proper bone marrow transplant.

Progress and data expected in 2014

Actimab-A is currently in a Phase I/II trial, and we should see progression into the Phase II portion next year along with some early Phase I data. Iomab-B should enter its Phase III trial next year, and we should see the Phase II data at some point in the year.

It's hard to collect enough data to support hematologic cancer drugs for final FDA approval, although these products can be extremely successful if they surpass all the necessary hurdles because of the unmet demand. There is not much competition in the space either, and prices for patented cancer drugs remain extremely high.

The financials also look pretty good

I don't put as much emphasis on biotech financials, although I will give a nod to Actinium for a pretty clean balance sheet with no debt and a positive value for stockholder's equity ($1.9 million on June 30th 2013). The company is also using about $1.5 million each quarter for its activity, which gives the company until the middle of 2014 to raise more funds.

Outlook

It's going to take a few years for Actinium to gather the trial data needed to submit these drugs for final FDA review, although the wait will be worth it if the drugs are approved. Going forward, I would be particularly focused on Iomab-B, which is quite close to a Phase III trial. If approved, I think that this drug could be a very favorable option for patients (especially older patients) that are being conditioned for a bone marrow transplant. Because it is a targeted therapy it could potentially reduce the toxicity of the conditioning therapy without sacrificing efficacy, which increases both overall survival rates and quality of life.

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 (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.