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The Chemokine Concept

The biotech advances we have seen over the past 10 years have been absolutely mindboggling. Some of them have drawn a great deal of press, and market recognition. Examples include cloning, regenerative medicine, and lately even 3D printing with living cells. Biotech was one of the strongest performers of 2013. Its cousin, biopharma, received less parading, but also did well.

New trends within these sectors warrant close attention. I believe a new "sub-sector" of biopharma has begun, but has drawn little or no market awareness. On the surface, companies within this sub-sector could look just like any other biopharma, but their research is oriented on chemokine pathway drugs. I call this sector "chemocentric".

This article explains the chemokine system, describes characteristics of chemokine pathway drugs, and explores their medical breakthrough & market potential. It provides investment logic oriented on pipelines and company specifics. It then reviews some pipelines, and analyzes them according to the given principles. It closes with some larger-scale predictions, and wraps it up with a detailed list of chemokine receptors and the indications they are associated with.

Chemokines

Definition

Chemokines are a subcategory of cytokines, which are signaling-proteins ("ligands") that bind to cells to direct their behaviors, and by extension, systemic behavior. Each type of chemokine ligand has one (or more) respective receptor; these receptors are specific to particular types of cells. As a group, chemokine ligands can transmit a broad swath of different signal types, each with a respective meaning.

Chemokine Ligands & Respective Receptors

(Chemokines and Their Receptors)

The "Normal Role" Of Chemokines

The most common role of chemokine ligands is to direct cell migration ("chemotaxis", "homing") for the immune system. The two general categories are "Basal" and "Inflammatory". Basal chemokine ligands operate on the lymph and thymus system. They are responsible for basal-leukocyte migration. Inflammatory chemokine ligands are formed under pathological conditions, and actively participate in the inflammatory response, attracting immune cells to the site of inflammation. Chemokine ligands can also perform other roles. "The human chemokine network is made up of more than 50 known chemokine ligands and approximately 25 identified chemokine receptors." (ChemoCentryx)

Role Of Chemokines In Disease & Conditions

Research has revealed that over-expression of chemokine signal response is central to a number of diseases and conditions, many of which are autoimmune or inflammatory in nature.

"The last 20 years of chemokine research has led to extraordinary new findings, revealing key roles for chemokines in inflammation, development and organogenesis, angiogenesis, hematopoiesis, atherosclerosis, wound healing, chronic inflammation, viral infection, homeostasis, autoimmunity and cancer. "

(Chemokine Research Moves On, Ann Richmond, PhD)

The table at the end of the article ("Pathway:Disease/Condition Associations") shows a number of specific diseases and conditions whose pathology is tied to the overexpression of chemokine receptors.

General Categories & Characteristics of Chemokine Drugs

Characteristics

In the wake of years of chemokine research , a new family of drugs has begun to emerge: chemokine pathway drugs. So far, its members tend to have the following characteristics:

  • By definition, oriented on the moderation of chemokine pathways.
  • Agonist, Antagonist or Inhibitor.
  • A role-tendency towards immune-response and/or inflammation (others are also possible).
  • Highly specific targeting of one or more receptor(s).
  • Small Molecule.

Agonist, Antagonist or Inhibitor

Theoretically, chemokine drugs could directly negate or amplify a receptor, or they could inhibit the ligands which would have bound to that receptor. In the case of negation, the drug binds to the receptor, and blocks. These drugs are called antagonists. In the next case, amplification, the drug binds to the receptor and "imitates" a natural ligand signal. These drugs are called agonists. Finally, the drug could intercept chemokine ligands before they ever get near a receptor. These drugs are called inhibitors.

Role Tendency

Chemokine drugs & candidates tend to be antagonists. Pathway suppression provides the capacity to reduce overexpressed inflammatory and immune response which causes many diseases and conditions.

Highly-Specific Targeting

Just as the chemokine system itself, chemokine drugs have the capacity to target specific types of cells with specific messages ("pathways"), while bypassing cellular non recipients.

Small Molecule

Chemokine drugs tend to be small-molecules, as is characteristic of the proteins they imitate. That makes them cheaper to manufacture, because fewer steps are required to produce them.

Breakthrough Potential

For these reasons, experts within the field view chemokine-pathway drugs as having breakthrough potential:

  • Past Success with HIV.
  • Known Possible Breakthroughs.

Past Success with HIV

Chemokine pathway drugs have only recently become technologically feasible. The chemokine system was not well-understood until about 20 years ago, when research was spurred by the discovery of HIV. As might be expected, the first FDA-approved chemokine pathway drug (Maraviroc) was an HIV treatment; it was a CCR5 antagonist to stop the immune system from destroying its own cells with immune response. The FDA cleared final approval in 2007. Since that time, research has progressed, and a few other chemokine pathway candidates have also achieved FDA approval, but most of the potential remains untapped.

Known Possible Breakthroughs

Chemokine receptors are regarded as "highly-attractive drug targets" which could resolve a host of indications:

"The chemokine receptors, belonging to the family of G protein-coupled receptors are considered attractive targets for therapeutic intervention. Chemokines and their receptors play a prominent role in the development, homeostasis and activation of leukocytes in the innate and adaptive immune system. Expression of chemokine receptors is not confined to leukocytes, but is also apparent on cells of nonhematopoietic origin such as endothelial cells and neurons. Their excessive activity or dysfunction, however, is associated with the establishment of inflammation and diseases such as multiple sclerosis, inflammatory bowel disorder, arthritis and atherosclerosis. There is growing evidence that chemokines play a role in cancer, including cancer metastasis and angiogenesis. Virus-encoded chemokines, chemokine receptors and chemokine scavengers have been identified, underscoring the importance of the chemokine system in viral pathogenesis. Besides chemokine receptors, CCR5 and CXCR4 have been shown to play profound roles in HIV pathogenesis through their ability to act as co-receptors for viral entry."

(Chemokine Receptors as Drug Targets, Raimund Mannhold, PhD, Hugo Kubinyi, PhD, Martine J Smit, PhD, Sergio A Lira, PhD, Rob Leurs, PhD)

"...we anticipate that additional research will lead to successful clinical trials with chemokine antagonists so that we can positively impact outcomes for chronic obstructive pulmonary disease, rheumatoid and osteoarthritis, diabetes, atherosclerosis, acquired immune deficiency syndrome, transplantation, cancer, multiple sclerosis, and many other disorders affected by chemokines."(Chemokine Research Moves On, Ann Richmond, PhD)

Those are potent statements coming from PhD's specialized in this field. Their statements really don't need any reinforcement, but to give you a partial idea of the scope of their claims, again I direct you to the table at the very end of the article, "Pathway : Disease / Condition Associations". Each disease / condition listed is not just a problem, but a problem which could potentially be resolved with chemokine pathway drugs.

Business Strategy

As might be expected, with new technology comes new business. Chemokine pathway candidates are no exception. There is reason for developers to be optimistic:

  • As stated above, the family of drugs is likely to yield many medical breakthroughs.
  • Gold Rush For Exclusivity: Pathway Roles, "Role Monopolies".
  • FDA Support.

Gold Rush For Exclusivity: Pathway Roles, "Role Monopolies"

Because chemokine drugs have only recently become technologically feasible, there is little or no competition from preexisting drugs. The first to clear FDA receive a monopoly on their compound, and defacto monopoly on its role. That's a tremendous business advantage, and it can expand as new indications are approved.

Consider Maraviroc, the only CCR5 antagonist on the market. In 2009 Pfizer formed a partnership with GSK and transferred rights for Maraviroc to a joint venture, ViiV, which renamed "Maraviroc" to "Selzentry". In 2011 alone, Selzentry generated $177 million in revenue. Selzentry was highly profitable because the drug monopoly, was also a receptor-role monopoly, and there was no therapeutic alternative. Although other candidates are being developed, there is no other FDA-approved CCR5 antagonist, nor therapeutic alternative. As a direct result, Selzentry remains a cash cow to this day. That highlights a great reason to pursue pathway-agency exclusivity, but it doesn't stop there. As it becomes confirmed that CCR5 antagonists are relevant to new problems, the potential value of ViiV's pathway-agency exclusivity on CCR5 antagonists expands. For instance, Selzentry has been tested for its capacity to suppress immune response during marrow transplantation. If those tests were to succeed, Selzentry's market exclusivity would increase in value that much more. Now it's true, the new role must clear FDA, but it is already known that the drug has cleared a phase 1, which eliminates 30% of "raw candidates". It's also more likely to clear the remaining phases, because it is already known that Selzentry is an effective CCR5 antagonist. Therefore, if a CCR5 antagonist is suited to the therapeutic marrow transplantation, Selzentry has some great potential to do it.

The lessons learned from the example of ViiV & Selzentry can be generalized to a larger order of logic. Pathway-role-exclusivity constitutes strong positioning, assuming the pathway-agency can yield a marketable therapy (or therapies). That is why I view the efforts to develop chemokine pathway drugs as having some characteristics of the Gold Rush. The first one in would appear to have the best positioning. Even so, a latecomer can still hit the motherload.

FDA Support

Because the pharmaceutical industry is just starting on chemokine drugs, very few chemokine-pathway agencies correspond to existing FDA-approved drugs. New chemokine drugs are likely to be first-in-class, and provide groundbreaking therapies. If they address something new, or do something in a superior way, they are more likely to earn fast track and breakthrough status, whereby the development & approval process is streamlined and accelerated. That reduces development time, and translates to reduced expenditures and shorter time to market.

Investing in "Chemocentric" Companies

There are reasons to consider investment in this sector:

  • The first reasons were stated above, in "Business Strategy".
  • Emerging Trend: New wave of chemokine pathway drugs.
  • Chemokine Pathway Drugs: From Obscurity To Limelight.

Emerging Trend: New Wave Of Chemokine Drugs

Maraviroc was hailed as a medical breakthrough, and for those who recognized that it came from a new class of drugs, it validated the potential of that class. Not knowing how this drug came into being, most of the market took Maraviroc to be a single leap, one drug, rather than the beginning of a chemokine drug trend. Even so, it is reasonable to expect a wave of chemokine drugs to expand into their untapped niches. The first breakthroughs will have solid monopolies based on patents, and also defacto pathway-agency monopolies.

Chemokine Pathway Drugs: From Obscurity To Limelight

As each successive breakthrough brings positive attention to this new family of drugs, I expect to see it draw market attention, and investor interest.

Investment Strategies: Pipeline

Studying company pipelines can help to identify promising candidates. This sort of analysis might not be conclusive, but it can help to make informed decisions.

  • Pathway-Role-Uniqueness.
  • Indication-Uniqueness.
  • Performance.
  • Other Differentiations.
  • Market Potential.
  • Phase of Trials.

Pathway-Role-Uniqueness

Ask whether the pathway-role of the candidate is unique, or if there is prior FDA approval of another drug with the same pathway-role. Ask further if the candidate's agency is reflected in competitor's pipelines. How much direct pressure might the candidate have from other contenders?

Indication-Uniqueness

Ask whether the candidate has any therapeutic equivalent, either with prior FDA-approval or under development. Either way, the drug candidate could still have a lot of value, but indication uniqueness is sought after.

Performance

Ask whether the candidate's known test results outperform the results of known drugs or drug candidates in other pipelines. If so, this could add value to the candidate.

Other Differentiations

Even when things such as pathway-role-uniqueness, indication-uniqueness and performance look similar on face value, many subtle things can set candidates apart. Some differentiators are: side effects, risks, drug & dietary interactions, allergies, delivery (oral, intravenous, inhaled, etc), etc. Deeper analysis can very often redeem the underdog candidate.

Market Potential

Developing a good estimate of a drug candidate's market size can be important.

Phase of Trials

Ask what phase of trials the candidates are undergoing. Each phase up increases the value.

Investment Considerations: Company

Ask what sort of exposure you want, and to delve into the company's situation.

  • Micro, Small, Mid, Large Cap.
  • Pure Play vs Diversified: Direct vs Indirect Chemokine Exposure.
  • Partnerships & Financing.

Micro, Small, Mid, Large Cap

Micro - Small Cap biopharama's and biotechs are among the highest risk investments. They tend to have little or nothing in terms of earnings. Their pipelines are often oriented on relatively few candidates. Their market caps are based on abstract figures, which can be disputed without hard revenues to reinforce PPS. On good news, their PPS can increase dramatically overnight. On bad news, it can plummet. For all that, these stocks can pay in spades; Organovo is a great example.

Small - Mid Caps tend to have a bit more stability, larger pipelines, more cash, and maybe some revenue. Its plausible they could fund a human trial without partnerships or share issues. These factors help to offset some of the risk, and they still have growth potential.

Mid - Large Caps are a whole different investment world. Their value is distributed across many drugs and candidates, and they tend to have earnings. Their value is not just based on R&D potential, but anchored on actual sales. No single success or failure is likely to change the fate of the company. They have enough going on that it's all averaged into an aggregate of overall performance. They are unlikely to have difficulty funding their projects. If they have to issue shares, it will probably not be highly dilutive. They are much safer investments, but it's almost impossible they could grow in the same way a Micro-Small cap could, in part because their successes are averaged in with their failures.

Pure Play vs Diversified: Direct vs Indirect Chemokine Exposure

How much direct exposure does the company give to chemokine drug development? Is it specialized or hybridized?

Partnerships & Financing

Ask if the prospective investment has the cash or partnerships to achieve its goals. Study the cash and the burn rate.

Pipelines

This section shows the chemokine drug pipelines of some drug developers. It is not intended to represent every chemokine drug maker. I have tried to be methodical, but there are alternate nomenclatures for chemokine receptors, and my searches were conducted using chemokine receptor names. Here is one source for nomenclatures which I did not use. There's room for further investigation.

Guidelines for Reading the Pipeline Tables:

You can cross-reference the pathway listed in the pipeline table with the receptor in "Pathway : Disease / Condition Associations" (at the end of the article). If the two are the same, there is a chance that the candidate (or drug) indications could eventually be expanded what's listed in the second table. That would require human trials, and take time.

The pathway-agency in the pipeline table is presumed to be "antagonist" unless stated otherwise.

Companies listed in the first section are focused primarily on chemokine research. Those in the second section are "hybrids", primarily oriented on other things, but also developing or marketing one more chemokine drugs.

Chemokine Pipelines

ChemoCentryx (CCXI)

Candidate Name

Indication

Pathway

Phase

Vercirnon

  • Crohn's Disease

  • Inflammatory Bowel Disease

CCR9

3

CCX140

  • All Manner of Chronic Kidney Disease

  • Diabetic Nephropathy

  • Diabetes

CCR2

2

CCX354

  • Rheumatoid Arthritis

CCR1

CCX872

  • Renal Indications

CCR2 2G

1

CCX507

  • Inflammatory Bowel Disease

  • Crohn's Disease

CCR9

CCX650

  • Glioblastoma

  • Tumor Growth Regulation

CXCR7

preclinical

CCX6239

  • Atopic Dermatitis

CCR4

CCX- - -

  • Chronic Hepatitis

CXCR6

CCX- - -

  • Autoimmune Diseases

CCR6

Source: ChemoCentryx, ChemoCentryx: Platform, Pipeline, Spring-Loaded

Non-Chemokine Pipeline: 1 other phase 2.

Tobira Therapeutics (Private Company)

Candidate Name

Indication

Pathway

Phase

Cenicriviroc

(TBR-652)

  • HIV

CCR2 & CCR5

2

TBR-220

  • HIV

CCR5

1

TBR-652

  • Inflammatory Diseases

CCR2 & CCR5

preclinical

Source: Tobira Therapeautics, AidsMap

Partial Chemokine Pipelines

These companies don't offer pure market exposure to chemokine drug development, but they do have chemokine drugs either on the market, or chemokine drug candidates in their pipelines. This section will examine only their chemokine profiles.

ViiV Healthcare (Private Joint Venture)

  • Owned by GlaxoSmithKline, Pfizer and Shionogi & Co (OTC:SGIOF)

Drug/Candidate Name

Indication

Pathway

Phase

Selzentry

(Celsentri)

(Maraviroc)

  • HIV

CCR5

FDA Approved

PF-232798

  • HIV

CCR5

2

GSK706769

  • HIV

CCR5

1

Source: ViiV Healthcare

Actively marketing 10 additional FDA approved drugs (11 total, with Selzentry).

Non-Chemokine Products: 10 Approved Drugs.

Non-Chemokine Pipeline: 1 phase 1, 3 phase 2.

GlaxoSmithKline (GSK)

Candidate Name

Indication

Pathway

Phase

1325756

  • Chronic Obstructive Pulmonary Disease

CXCR2

1

Source: GSK

Non-Chemokine Products: 92 Prescription Drugs & 53 consumer healthcare products (NYSE:USA).

Non-Chemokine Pipeline: 26 phase 1, 47 phase 2, 31 phase 3, and 8 approved candidates.

Genzyme (Private)

Drug Name

Indication

Pathway

Phase

Plerixafor

  • Blood Stem Cell Mobilization for Transplants

  • Multiple Myloma

  • Non-Hodgkin Lymphomas

CXCR4 (Inhibitor/ "partial agonist")

CXCR7 (allosteric agonist)

FDA Approved Orphan Status

Source: Wikipedia(NYSE:A), Wikipedia(NYSE:B), Nature

Non-Chemokine Products: 14 FDA approved drugs & product families.

Non-Chemokine Pipeline: 4 phase 1, 2 phase 2, and 3 phase 3 candidates.

Pfizer (PFE)

Candidate Name

Indication

Pathway

Phase

PF-04634817

  • Diabetic Nephropathy

CCR2 & CCR5

2

Source: Pfizer

Non-Chemokine Products: 206 FDA approved drugs & products.

Non-Chemokine Pipeline: 31 Phase 1, 23 phase 2, 20 phase 3, 6 in regulatory process.


CytoDyn, Inc. (OTCQB:CYDY)

Candidate Name Indication Pathway Phase
PRO 140
  • HIV
CCR5 2

Source: CytoDyn
Non-Chemokine Pipeline: 1 Phase 2, 1 Preclinical

Bristol-Myers Squibb (BMY)

Candidate Name

Indication

Pathway

Phase

- - - -

  • Metabolics

CCR2 &

CCR5

2

- - - -

  • Oncology

CXCR4

1

- - - -

  • Metabolics

CCR2 &

CCR5

1

Source: BMS

Non-Chemokine Products: 39 FDA approved Drugs

Non-Chemokine Pipeline: 14 phase 1, 8 phase 2, 6 phase 3, 12 marketed products under development.

Analyzing the Pipelines

ChemoCentryx is the only company granting direct market exposure to chemokine-pathway drug development. Its chemokine pipeline is diversified across many indications and receptors.

As it turns out, GSK owns a stake in CCXI. Investors who wanted a share of indirect exposure could do so through this company, but the relative market caps make this a dubious strategy. Even a major CCXI win would not necessarily move GSK's stock very much.

Referring back to "Pathway-Role-Uniqueness", in some cases we see companies making what would appear to be a strategic blunder: new candidates with identical pathway-agency and indication as a fully functioning FDA-approved predecessor. I speak specifically to the overlap of CCR5 antagonist candidates. Unless these candidates are differentiated they could go head-to-head with Selzentry.

There are also many candidates in the CCR2+CCR5 antagonist bracket. Eventually there could be competition if more than one of them pass, but for now they are still just candidates, and they have indication-differentiation. Even if they all clear FDA for the expressed indications, their "identical" agency won't put them into competition until they initiate and clear additional human trials for the competing indications... so there isn't an immediate threat to one another, but it's a cause for longer term concern.

Conclusions

Look for advances from the chemokine-pathway drug development sector. Only time will tell, but we have been given all the right reasons to expect meaningful breakthroughs. This industry is all about innovation, and I don't expect it all to come from one place, but I do expect to see chemokine drugs outperform. There are not many players going in specifically on chemokine-pathway drugs, and fewer still are public. Investors who want direct market exposure to chemokine-pathway drug development can only do so by investing in CCXI. I believe that's a valid reason this investment could perform well. The market has no other place to turn, the company shows promise in what it does, and its pipeline is diversified across many receptors and indications.

Chemokine-pathway candidates have a set of distinct advantages both during trials, and post FDA approval (on the market). I say that because almost any progress with a new chemokine-pathway drug is groundbreaking. That provides the FDA an incentive to streamline chemokine-pathway drug research. It also reinforces profitability once candidates reach market. The first-in-class will not just hold drug patents, but defacto receptor-agency monopolies. That market advantage can also be expanded to new indications. Selzentry provides a compelling example of the potential, and the list of conditions caused by chemokine disorders shows how broad that potential really is. The market does not seem to have woken up to this fact, yet: Maraviroc was the forerunner of a new drug trend, one which has barely begun.

Pathway : Disease / Condition Associations

Receptor

Diseases and/or Conditions

CCR1

  • Rheumatoid Arthritis

CCR2

  • Multiple Sclerosis

  • Diabetes (all types), Diabetic Nephropathy

  • Lupus Pain

  • Vascular Restenosis

  • Renal Indications

  • Atherosclerosis

  • Ischemia-Reperfusion

CCR3

  • Allergic Rhinitis

  • Asthma

CCR4

  • Atopic Dermatitis

  • Asthma

  • Allergic Rhinitis

CCR5

  • Several Bacterial and Viral Infections, including HIV

  • Inflammatory Diseases

  • Sepsis

  • Oncology / Cancer

  • Graft Rejection: Heart, Bone Marrow

CCR6

  • Autoimmune Diseases

  • Rheumatoid Arthritis

  • Psoriasis

  • Asthma

  • Multiple Sclerosis

CCR7

  • Tumorigenesis, Metastasis, Angiogenesis

CCR8

  • Asthma

CCR9

aka

ACKR2

  • Inflammatory Bowel Disease, Crohn's Disease

CCR10

aka

ACKR2

  • Cancer Growth, Metastasis, Angiogenesis

CCR11

aka:

ACKR4

  • Decoy Receptor for Chemokine Ligand Reuptake. (CCL19, CCL21 & CCL25)

CCR2 & CCR5

  • HIV

  • Inflammatory Diseases

  • Diabetic Nephropathy

  • Metabolics

CXCR1

  • Chronic Obstructive Pulmonary Disease

  • Graft Rejection: Kidney

  • Breast Cancer

  • Cystic Fibrosis

CXCR2

  • Chronic Obstructive Pulmonary Disease

  • Cystic Fibrosis

  • Tumorigenesis, Metastasis

CXCR3

  • Psoriasis

  • Graft Rejection: Lung

  • Rheumatoid Arthritis

  • Inflammatory Bowel Disease

  • Multiple Sclerosis

  • Diabetes

CXCR4

  • Several Bacterial and Viral Infections, including HIV

  • Sepsis

  • Oncology / Cancer, Metastasis, Angiogenesis, Tumorigenesis

CXCR5

  • Asthma

  • Chronic Obstructive Pulmonary Disorder (COPD)

  • Pulmonary Fibrosis

  • Systemic Lupus Erythematosus

CXCR6

  • Chronic Hepatitis

CXCR7

aka

ACKR3

  • Glioblastoma

  • Tumor Growth Regulation

CXCR4 & CXCR7

  • Blood Stem Cell Mobilization for Transplants

  • Multiple Myloma

  • Non-Hodgkin Lymphomas

  • Counteracting Opioid-Induced Hyperalgesia

CX3CR1

  • Atherosclerosis

  • Ischemia Reperfusion

XCR1

aka

CCXCR1

  • Rheumatoid Arthritis

DARC

aka

ACKR1

  • Metastasis Suppression

  • Aging Tumor Cells

Sources: Chemocentryx, Chemokines and their Chemokine Receptors, Chemokines and Their Receptors, , Nature, ASNJournals(1), ASNJournals(2), InformaHealthcare, NCBI, CXCR1, Clinimmsoc, Chemokine Receptors, WikiGenes(1), WikiGenes(2)

Note: This list might not be exhaustive.

Source: The Chemokine Concept