Today Benitec (BNIKF, BTEBY) announced that it has appointed Dr Claudia Kloth as Vice President of Manufacturing. As the company's most advanced program is only at the early stage of a Pl/Plla trial for a treatment for Hepatitis C (HCV) one could be excused for wondering why the company would need a VP of Manufacturing. The HCV treatment, TT-034, has still got a number of hurdles to overcome before large scale manufacturing will be needed, so why appoint a highly paid executive to oversee this process?
Has Benitec's management lost its marbles?
We know that, if successful, TT-034 will be the model for the Hepatitis B (HBV) drug and that AAV is the likely delivery vector for the Age-Related Macular Degeneration (AMD) program. We also know that the company intends to incorporate the use of doggybone DNA in the production of expression cassettes for the HBV and Non Small Cell Lung Cancer (NSCLC) trials. It will also be necessary to manufacture a new batch of TT-034 should the clinical trial move into a Pllb stage. All this means that there is work for Dr Kloth to get started on. But, is this enough to warrant a VP Manufacturing?
What we do not know, but Benitec's management does know, are the results from the biopsies of the first two patients in the TT-034 trial. In the announcement, Peter French says,
We have taken this step now as we are confident that our TT-034 program is progressing well and we are looking at the next stage - scale-up of the AAV manufacturing to service the potentially very large markets for our novel therapeutic products for HCV and HBV.
This has to be the strongest indicator yet that the liver biopsies from the two TT-034 patients have displayed results above or at least equal to expectation. Even if there are further delays in recruitment, what counts are the biopsy results and the viral load reduction so if the early indications are outstanding, then the appointment of a VP Manufacturing is really a good move to make.
The quality of the manufacturing process is extremely important in the manufacturing of all drugs but particularly so in the case of gene therapies that require a delivery vector. The percentage of empty capsids manufactured could be a determining factor in the effectiveness of any such therapy as could the design/modification of the vector itself (interesting article here). Planning for the scaling up of the process now is therefore a very proactive move by the company.
In answer to the question asked at the start of this post, I think that management know more than the rest of us and that they have not lost their marbles. They are sending out a message that TT-034 will be a contender.
It is still early days for TT-034 but, on the limited evidence currently available, it seems that it is going to be full-steam ahead as far as efficacy is concerned, which means the current share price is well below the real value of the stock.