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Brian Nichols, NicholsToday (504 clicks)
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While shares of OncoSec Medical (OTCQB:ONCS) have been under pressure as of late, the company's stock has produced great gains over the last year. OncoSec, along with Inovio Pharmaceuticals (INO), is part of a class that uses electroporation as a drug-delivery technology, which uses electrical currents to decrease side effects and increase the uptake of agents. The potential for this technology is still widely unknown, still being investigated, but late last week I had the opportunity to speak with two leaders in the space: OncoSec's CEO Mr. Dhillon and CMO Dr. Pierce; who was previously at Merck (MRK) and is renowned in the realm of anti-PD-1 development. Dr. Pierce joining OncoSec is a big win for the company, and as you'll read, his knowledge, expertise, and goals should leave OncoSec investors with a very pleasant outlook on the future.

Brian Nichols

Dr. Pierce, as the co-author of over 50 peer-reviewed journal articles and book chapters, and after having a very distinguished career with Merck's Research Labs, what do you see as a good opportunity in immune-oncology looking ahead?

Dr. Pierce

I saw intratumoral pIL12 as addressing a huge unmet medical need: How do we convert non-immunogenic tumors into immunogenic ones? Furthermore, I became enamored with electroporation as a platform technology, capable of effectively delivering a tremendous array of immunomodulatory payloads.

Brian Nichols

At Merck, what was your most recent clinical focus?

Dr. Pierce

I spent the last several years at Merck largely focused on the question "who responds to anti-PD-1 immunotherapy?" And its corollary, "who doesn't respond to anti-PD-1 immunotherapy?"

When I was leaving Merck, I was focused on finding a company with a therapeutic approach that would convert anti-PD-1 non-responders into responders. In my opinion, this is the greatest unmet medical need in immune-oncology today.

Brian Nichols

What do you mean by converting anti-PD-1 non-responders into responders?

Dr. Pierce

If you look at the melanoma patients - a disease which has the highest monotherapy response rates with anti-PD-1 therapeutics seen to date - something on the order of 60% to 80% of patients will not respond to PD-1 Checkpoint Inhibitors. This non-responsive patient population largely corresponds to those patients who do not have TILs (e.g. CD8+) in their tumors.

In short, the PD-1 non-responder patients are those patients who fail to mount a significant adaptive immune response against the tumor: their tumors appear to be non-immunogenic. Even in melanoma, anti-PD-1 non-responders are still the majority. In other solid tumors, the fraction of PD-1 non-responders/non-immunogenic tumors are likely to be even greater. Thus, there is a tremendous unmet medical need, across many solid tumors, which can be simply stated as: the need to convert non-immunogenic tumors into immunogenic ones.

Brian Nichols

How exactly does OncoSec fit into this equation, and with that said, why did you choose to work with OncoSec?

Dr. Pierce

I was attracted to OncoSec because I believe that intratumoral electroporation of IL-12 will answer this need and we have released both Phase 1 and interim Phase 2 data, which not only demonstrates significant clinical response rates, but clearly demonstrates that intratumoral IL-12 is driving a systemic antitumor immune response.

So, for all of those reasons, OncoSec's IL-12 program hooked me.

Brian Nichols

OncoSec's pipeline revolves around a technology called electroporation, what is it?

Dr. Pierce

Electroporation is a tool, which is been utilized in the laboratory setting to transduce DNA plasmids for decades. The concept, however, that electroporation could be utilized for intratumoral delivery of genes in cancer patients, was new to me - before I started my own "due diligence" on OncoSec's technology and history. The therapeutic flexibility of this platform, I believe, is self-evident and I am excited to explore with OncoSec a variety of new immunomodulatory DNA payloads.

Brian Nichols

Dr. Pierce, as an Executive Director at Merck Research Labs we know that played a large role in the company's Anti-PD-1 programs. In OncoSec's Strategic Update most investors were drawn to the prospects of a Phase 1 study in a new solid tumor indication and expanding the pipeline for combinations with immune modulating agents such as anti-PD-1, anti-PDL-1, or anti-CTLA4. Given your history, your new position, and what we've already discussed, is it safe to say that this new program will test electroporation with Anti-PD-1s? And what solid tumors are you exploring?

Dr. Pierce

Yes, based on what we know about the mechanism of IL-12 and our own Phase 1 and phase 2 data, we would expect that OncoSec's IL-12 electroporation will significantly augment the immunogenicity of tumors, effectively converting PD-1 non-responders into responders.

Currently, we are exploring a variety of different avenues and clinical trial designs to test this hypothesis. The rationale, however, for enhancing immunogenicity with plasmid IL-12 electroporation in combination with inhibitors of T effector cell checkpoints such as PD-1 is in no way limited to melanoma. Head & Neck and breast cancer are two non-cutaneous oncology indications that are under consideration, but we haven't made any firm decisions or commitments yet. We plan to be opportunistic in both the selection of potential partners and indications.

Brian Nichols

If there is data or reason to believe that this technology could meet that unmet need of converting non-responders then I think it is clear why you chose OncoSec.

Mr. Dhillon, one area where I must commend you is with your company's low cash burn. Often times we see companies with several ongoing clinical trials spend your annual burn rate in a quarter's time. How is it that OncoSec has managed to spend so little, and given the research mentioned by Dr. Pierce and the initiation of new trials, how will you financially balance all of these activities?

Mr. Dhillon

A balanced burn rate is an ongoing "catch-22" - spending too fast on R&D can quickly deplete resources and lead to a lack of focus, while spending too little can often lead to missed opportunities or hamper clinical development.

We have been fortunate to keep a very lean burn rate by focusing on core development initiatives defining a streamlined commercial path forward and now with a strong balance sheet, we have expanded that effort to include additional exploratory research to expand our development pipeline.

We will continue to evaluate other non-dilutive opportunities to fund our exploratory research. Steadily, OncoSec continues to grow as we attract top researchers and build our team.

Brian Nichols

Mr. Dhillon, if ImmunoPulse is successful in treating melanoma I think it's common sense that OncoSec will have to complete larger trials before FDA approved. However, the study that really appeals to me as an investor is the one treating Merkel cell carcinoma (MCC). This is a disease with no treatment; there are no ongoing trials; and to the best of my knowledge, there are no planned trials. This is an orphan indication, and you are conducting a 15 patient trial. So, if successful, and IL-12 uptake is clearly evident, couldn't ImmunoPulse be on the market rather soon to treat this one indication?

Mr. Dhillon

This is an astute question. You're right that currently there is no good option for MCC patients and there is a potential accelerated pathway for approval in this indication for an effective therapeutic compound. OncoSec is continuing to enroll in our MCC trial and evaluate a development strategy.

Brian Nichols

Mr. Dhillon, I only asked the prior question because it seems that most of OncoSec's valuation and its last year of strong stock performance is tied to melanoma. However, in 2014 MCC could dominate the headlines for OncoSec. What are some other things outside of melanoma and MCC that you think are exciting in 2014 and beyond for both OncoSec and electroporation?

Mr. Dhillon

We tend to disagree that OncoSec's value proposition is linked directly to melanoma, for the first investors should recognize the broad application of ImmunoPulse at the ability to address a significant unmet population by combining our approach with other immune-modulating agents. The OncoSec platform has a very broad application - both in terms of candidate therapeutics (i.e. DNA payloads) and tumor indications. What excites me most is that in the future ImmunoPulse has the ability to potentially make an even bigger impact then what we may see in melanoma or other cutaneous tumors.

To date, we have focused on cutaneous tumors because it represents "the low hanging fruit" in terms of ease of access for electroporation technology, but once we unequivocally demonstrate proof-of-concept for IL12, we don't foresee being limited to cutaneous tumors but will be able to leverage this technology to treat many different types of tumors.

For OncoSec this includes, H&N, breast, prostate, sarcoma, ovarian cancers, and other, but as noted by Dr. Pierce we have not made any commitments yet. For Electroporation this list can be fairly exhaustive…

I can comment however that OncoSec is continuing to pursue additional opportunities to expand our intellectual property and maintain our leadership in this area of treating solid tumors.

Brian Nichols

Dr. Pierce do you have any thoughts on the prior question or Mr. Dhillon's statement?

Dr. Pierce

To underscore what Punit already mentioned: I look forward to initiating a Phase 2 trial in a non-cutaneous oncologic indication as this will help show the broad application of this technology in oncology. Also, I'm excited by the challenge of building a pipeline of candidate immunomodulatory molecules that capitalizes on the tremendous flexibility of this technology and builds on the success of our IL-12 therapy in inducing systemic anti-tumor immune responses.

Brian Nichols

Dr. Pierce I'd like to ask you about Inovio Pharmaceuticals and the potential for this technology. Inovio has a major catalyst later this year when it reports top-line data from a Phase 2 study of VGX-3100 for the treatment of cervical dysplasia. With that said, what do you think are the limitations for electroporation? Do you think this is a technology that can only be used to treat some cancers and infectious diseases, or is it a delivery platform that could be used to treat common disease with any agent? In other words, how early are we in discovering the potential for this technology?

Dr. Pierce

I think we were at the very beginning of exploring the potential of in vivo electroporation as a drug delivery platform. As you mention, there may be widespread applicability in a host of disease areas including, but not limited to, infectious disease and oncology. One aspect of this technology that I think hasn't been adequately appreciated, is the potential to use electroporation of DNA constructs to more quickly and more cheaply address therapeutic hypotheses in patients. Even if, for example, the ultimate drug of choice might be a monoclonal antibody with a long half-life, one could potentially test whether or not the drug does what you think it will in patients at a fraction of the cost and a fraction of the time required for the development of a recombinant protein or humanized monoclonal antibody.

The other largely unexplored dimension of electroporation technology is the ability to simultaneously deliver multiple plasmids or plasmids containing multiple active components. I think the consensus is emerging, particularly in immune-oncology that we need to combat the multilayered immune-subversive mechanisms deployed by tumors by the rational combination of immunomodulatory drugs. I see electroporation as a key therapeutic modality in this fight.

Brian Nichols

Lastly, if there are multiple, or countless agents that can be used with electroporation, what is the process of determining which agents to test in clinical trials? And how will this process evolve moving forward into the next stage of development?

Mr. Dhillon

This is a good problem to have, although too many potential candidates could dilute a company's focus. We will prioritize our future candidate molecules based on (1) our understanding of their mechanism of action as immunomodulatory molecules, (2) whether or not the pathway already has proof of concept in patients, and (3) the likelihood of synergistic action with intratumoral electroporation of IL-12.

Conclusion

Dr. Pierce and Mr. Dhillon gave a very broad outlook on ImmunoPulse and electroporation, one that should not only leave OncoSec investors optimistic, but also Inovio investors.

With that said, long interviews get read and are interpreted in many different ways: What I may think is most important might have been forgotten by you. Hence, after speaking with both, and following this interview, I will conclude with five key bullet points that I find to be most important following this conversation. Otherwise, you can dissect the information as you see fit, but in my opinion, both OncoSec and Inovio are definitely worthy of additional due diligence.

  • Dr. Pierce believes that converting the majority of metastatic melanoma patients (in the range of 60%-80%) patients who are anti-PD-1 non-responders to responders one of the greatest unmet medical needs in immune-oncology - likely because of the foreseen impact of anti-PD-1s in treating cancer.
  • Dr. Pierce came to OncoSec from Merck and believes that early data suggests IL-12 electroporation could effectively convert PD-1 non-responders to responders, which is something we haven't heard before.
  • New solid tumor trial supporting the mechanism of action and broader application of ImmunoPulse and that the Phase 2b Melanoma trial will likely be in combination with a PD-1 checkpoint inhibitor. Neither Dr. Pierce nor Mr. Dhillon say specifically, and insist that all avenues are being explored, but given Dr. Pierce's history, his beliefs, and his answer to the question let's us know that almost definitely this will be the agent tested with electroporation.
  • There is potential for accelerated MCC approval "if" robust data is present. This indication is an under-the-radar Phase 2 orphan indication with a $200-$300 million market opportunity. This will be an interesting program to monitor in 2014 because of it being an orphan disease, but note that investors should first wait to see data before speculating.
  • Lastly, electroporation has promise in treating breast, prostate, sarcoma, and ovarian cancers, and many other tumors along with infectious diseases. Basically, the upside and possibilities are broad: OncoSec and Inovio investors should be pleased.
Source: OncoSec Executives Talk Electroporation, PD-1 Checkpoint Inhibitors, And The Unmet Need In Immune-Oncology