SLINGSHOT CONTRIBUTOR: Phil Loria
Various setbacks with their lead drug candidate, HEPLISAV-B, have taken investors in Dynavax on a rollercoaster ride the last few years. The FDA issued a response letter to the company in 2013 asking for more safety information on the vaccine, and they have since created a database of over 10,000 people who have been treated with HEPLISAV-B. Many think the drug has potential to be best in class, and it finally seems poised to gain FDA approval after Dynavax announced plans to refill its Biologics License Application by the end of March. This would put HEPLISAV-B on track to gain FDA approval in six months, which would be a substantial catalytic event in late 2016 for DVAX investors. If peak annual sales match projections of over $600 million we could see a significant decline in the sales of Engerix-B, and major changes in the valuation of DVAX.
There are several facts that suggest HEPLISAV-B is the superior treatment over Engerix-B, including a dosing regimen that only includes two doses compared to the three necessary doses of Engerix-B. Eliminating one dose limits the amount of times a patient has to come back to their healthcare provider's office and frees up resources for doctors to focus on more pressing matters. The drug showed a higher peak seroprotection rate at 95.4% versus Engerix-B's 81.3%, which shows it has more antibodies capable of preventing the virus. HEPLISAV-B also proved to be a better treatment for Hep-B patients with Type II diabetes, demonstrating a 90% response rate versus Engerix-B's 65.1%. Patients with types I and II diabetes have a higher incident rate of Hep-B than the general population, and doctors are particularly concerned with making sure they have protection from Hep-B. These results from HBV-23 suggest that HEPLISAV-B is not only better in treating vulnerable patients but also amongst each age decile of patients. FDA concerns over HEPLISAV-B's safety profile were also quelled; there were 21 autoimmune events across the entire trial, 11 attributed to Dynavax and 10 attributed to Engerix-B.
The recent HBV-23 results have left many questions for investors in both DVAX and GSK that we hope to address in an expert interview.
Questions for an infectious disease expert with experience treating patients that have HEP-B and vaccinating people with GSK's Energix-B
- Can you give us an idea of the Hep-B vaccine market now, what types of patients get vaccinated and how well covered people are currently?
- What is your initial impression to the top line data released by Dynavax?
- Do you see the data from HBV-23 being compelling enough that you would switch from using Engerix-B to HEPLISAV-B if it was approved? What percentage of your patients would you expect to prescribe HEPLISAV-B? Would you prescribe both or just select one for your patients?
- The most common adverse side effect for HEPLISAV-B was tenderness around the injection site, which was double in terms of prevalence (%) in HEPLISAV-B patients compared to the Engerix-B cohort in DVAX's Phase 2 study. What is the clinical relevance of this result? Does it raise any serious safety concerns for HEPLISAV-B that would lead doctors to stick with Engerix-B?
- The FDA was previously concerned that DVAX did not have enough safety data for HEPISLAV-B to receive approval. Do you think this will be an issue again or is DVAX ready to file for approval?
- With the available information what do you think the chances are of HEPLISAV-B being approved by the FDA?
This conversation will seek to give investors a better understanding of the patients that take Hep-B vaccines and how big HEPLISAV-B might become revenue-wise in relation to established treatments such as Energix-B.
Option 2: A discussion on Alnylam's patisiran program for transthyretin(tt)-Mediated amyloidosis in patients with familial amyloidotic polyneuropathy (FAP) and what it tells us about their RNAi program in general
Alnylam (NASDAQ:ALNY) is a leading RNAi (RNA interference) therapeutics company that recently announced its "Alnylam 2020" guidance, where by the end of 2020 they expect to achieve a profile with three marketed products, and 10 RNAi therapeutic clinical programs (four in late stages of development). In 2016 the company plans to "advance multiple Phase 3 programs, including the start of two fitusiran Phase 3 trials in hemophilia, and expects to have at least ten major clinical data readouts and to file three new IND applications." Investors are excited about of the array of potential catalysts for the company over the next few years; however the true value of ALNY lies in the validity of their RNAi technology. If the company can prove they have developed consistent and effective RNAi technology that will increase chances of success in many different programs, it will be a significant value driver for the company. If they fail to figure out their RNAi technology investors will back off and the company's valuation will undoubtedly fall.
Patisiran, which is aimed at treating ATTR amyloidosis patients with Familial Amyloidotic Polyneuropathy (FAP), is the company's lead program and is currently in a Phase 3 trial called APOLLO. The Phase 2 OLE study showed improved nerve fiber density and continued evidence of potential halting of neuropathy progression after 18 months of treatment, forming high expectations for the Phase 3 results. Patisiran also showed sustained TTR knockdown of up to 96%, and a mean maximal knockdown of 93% over 21 months compared to recent competitor data that reported a 76% mean maximal TTR knockdown after 10 months. If the Phase 3 APOLLO data comes back positive, ALNY will submit regulatory filings in 2017 for the U.S, EU, and other territories around the world.
Through our expert interview we hope to clear up questions surrounding Alnylam and the current state of RNAi technology.
Questions for a leading RNAi expert with the ability to talk about the current state of RNAi technology and previous setbacks in RNAi. Ideally he or she will have experience with some compounds in development, the diseases being targeted, and published literature on RNAi.
- At a high level how much certainty does the patisiran data disclosed to date give you that Alnylam's RNAi technology is safe?
- The patisiran Phase 2 data in FAP was very compelling thus far, what issues could arise in your opinion at 24 months or in the Phase 3 trial?
- How unique is the Alnylam's approach and how difficult do you think it will be for other companies to develop their own RNAi therapies? Does Alnylam have a chance at owning this class of therapies?
- Does the data so far mean they have a high chance of success on every program or is it more complicated than that?
- There has been a lot of attention on gene therapy candidates over the last two decades, and several high profile trials were stopped unexpectedly after negative side effects developed in patients. In 2002 a gene therapy trial in X-linked SCID was unexpectedly stopped after four patients developed leukaemia, which caused several big companies to move out of the space in the following years. Are there still concerns that gene therapies may have unexpected side effects that make them too risky for approval? Are regulators and the public ready to accept more gene therapy candidates or do RNAi candidates still face a higher level of scrutiny?
The goal of this conversation will be to understand how much confidence the current data on RNAi should give investors that ALNY can have success in a number of indications. The interview should help investors understand where ALNY currently stands given the current market cap, interest from large-cap pharma companies, and the history of issues with RNAi technology.
You Choose the Stock: Interactive Voting
- Seeking Alpha readers can vote by commenting below which project they would like us to post on Slingshot Insights next week.
- After the voting period ends, Slingshot Insights will interview a Subject Matter Expert then post a transcript and recording of the conversation on our website.
- Vote now in the comments below/direct messages to me within the 72-hour voting period to express your interest. Seeking Alpha readers can also join and add questions on Option 1: DVAX here or Option 2: ALNY here and get expert insights to enhance your investment diligence.
This column is designed to be engaging for a wide variety of biotech investors. Not every company might be of interest to everyone, so stay tuned for next week's match-up!
Disclosure: I/we 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.