Len Zehr's  Instablog

The proposed union of closely held Immune Pharmaceuticals of Israel and EpiCept (NASDAQ OMX Stockholm, OTCQX: EPCT) will create a combined company focused on antibody therapeutics for cancer and inflammation, with four products in the clinic, and a strengthened management team.

"For us, it was a compatible and synergistic deal, in terms of EpiCept's pipeline and key managers and our goal of becoming a public company in the U.S.," Immune CEO Daniel Teper says in an interview with BioTuesdays.com.

Founded in 2010, Immune began looking for ways to go public in the U.S. in 2011. "We initially were offered an option of a reverse takeover of a shell company. A full IPO was too much of a jump for us. We eventually decided that the most practical way was to join forces with an operating company, because it allows us to consider up-listing to NASDAQ or NYSE MKT as soon as we meet the exchange listing requirements," he recalls.

Immune and EpiCept initially began discussing a merger during the summer, with talks accelerating in late September and an agreement announced November 8. The transaction is expected to close in the first quarter of 2013. The merged company will be known as Immune Pharmaceuticals, with dual headquarters in Israel and the New York area.

Joining Immune is Robert Cook, interim CEO of EpiCept, who will become the CFO and a director of the merged company, and Dr. Stephane Allard, CMO of EpiCept, who will assume the same role with Immune. Immune director, Dr. David Sidransky, also will be named vice chairman of the new board. Dr. Sidransky is director of the Head and Neck Cancer Research Program at the Sidney Kimmel Comprehensive Cancer Center at Johns Hopkins University and a former vice chairman of the board at ImClone Systems.

Immune's lead drug candidate is bertilimumab, a monoclonal antibody that targets eotaxin-1, a key mediator of inflammation, angiogenesis and neurogenesis in multiple clinical indications, including indications in gastro-enterology, respiratory, ophthalmology, dermatology, oncology and neurology.

(click to enlarge)

Bertilimumab: Key Mediator of Inflammation, Angiogenesis and Neurogenesis in
Multiple Clinical Indications

Bertilimumab was developed by Cambridge Antibody Technology, which is now the biologics division of AstraZeneca. iCo Therapeutics licensed bertilimumab from Cambridge before granting Immune an option to in-license the drug for non-ophthalmic indications. Immune is developing bertilimumab for the treatment of two inflammatory bowel diseases - ulcerative colitis and Crohn's disease - as well as severe asthma.

Dr. Teper says Immune is currently initiating a Phase 2 clinical trial with bertilimumab for the treatment of moderate-to-severe ulcerative colitis. "We have a number of clinical milestones over the next 24 months that will provide an answer on proof-of-concept, safety and efficacy."

While Crohn's disease and ulcerative colitis are two different inflammatory bowel diseases, they share many symptoms, even though they are treated differently and occur in different places in the digestive tract. Most drugs that work in Crohn's disease also work in ulcerative colitis and vice versa, but that's not always the case.

There is renewed interest in targeting eosinophils in severe asthma since GlaxoSmithKline published the results of the DREAM trial in The Lancet last summer with mepoluzimab, a monoclonal antibody targeting IL-5. Both IL-5 and Eotaxin-1 are involved in the regulation of eosinophils. Immune is planning to initiate a pilot Phase 2 study in asthma in 2013.

In an interview, Raghuram Selvaraju, an analyst with Aegis Capital, says Immune is a very young company that has done a great deal of development with very little invested capital.

"What they've done so far is nothing short of staggering," Mr. Selvaraju says. "They have put together a genuine lead product candidate and a couple of technology platforms. That's very rare in the biotech industry. And with a public listing through EpiCept, Immune, in theory, should be able to obtain the capital necessary to conduct proof-of-concept clinical trials with bertilimumab, establish bertilimumab as a high value product and use that data to partner."

EpiCept's lead drug candidate is AmiKet, a topical analgesic cream designed to provide relief from neuropathic pain, which affects more than 15 million people in the U.S. alone. In the first half of 2011, EpiCept announced positive results from a National Cancer Institute-sponsored Phase 2 study, evaluating the efficacy and safety of AmiKet in chemotherapy-induced peripheral neuropathy (CIPN), a painful condition that frequently occurs following systemic chemotherapy, which can interrupt, delay or even prevent completion of chemotherapy treatment. No drugs have yet been approved to effectively treat this condition, which is a significant unmet need.

Amiket has clinical data from over 1,600 patients in various neuropathies, including 461 patients in the NCI's Phase 2 study. AmiKet also has fast track designation and Phase 3 special protocol assistance from the FDA as well as a defined clinical path through the European Medicines Agency. An independent third party consultant has estimated AmiKet's peak annual sales potential in the U.S. at approximately $400-million.

An 800-patient Phase 3 trial of AmiKet in CIPN is expected to begin after a co-development or out-licensing deal is arranged with a global or multi-regional pharma partner, which is targeted for 2013. Discussions with prospective partners are ongoing.

EpiCept's development pipeline also includes two drug candidates known as vascular disruptive agents, which represent a new class of drugs for oncology that are designed to shut down blood vessels in solid tumors. Both Azixa, which is in Phase 2 testing, and crolibulin, which is in Phase 1 testing, were developed in-house by EpiCept. The NCI is currently conducting a Phase 1/2 clinical study of crolibulin for the treatment of advanced thyroid cancer.

"In coming months, we will assess how competitive these agents are, what the best indications for them are and whether a development partnership is an attractive option," Dr. Teper figures. "We also will assess whether we can apply our own nanotherapeutic expertise to further improve the targeting of both agents."

NanomAbs, or nanoparticle monoclonal antibodies, which bring together the fields of nanotechnology and drug development, are a priority for Immune. These next-generation antibody drug conjugates are considered the next big thing in cancer treatment, because they are versatile enough to be designed to deliver more drug payload into a cancer cell and avoid exposing healthy tissue.

Immune's lead program, which is in late preclinical development, is a combination of two chemotherapies - gemcitabine and paclitaxel - with an antibody drug conjugate that targets pancreatic cancer and non-small cell lung cancer.

The technology, which was licensed from Hebrew University of Jerusalem, is, according to Dr. Teper, "distinct but similar in its approach" to that of two Boston-area companies-Bind Biosciences and Merrimack Pharmaceuticals-which have validated the approach in Phase 1 clinical trials.

Celgene recently demonstrated improved overall survival in pancreatic cancer patients with its cancer drug Abraxane, which is a nanoparticle of paclitaxel, with gemcitabine. Abraxane was first approved as a treatment for breast cancer. In October, the FDA approved it as a primary treatment for non-small cell lung cancer, and Celgene is also studying the drug as a treatment for pancreatic cancer.

"Immune's approach is to have two drugs in a nanoparticle with antibodies that further targets cancer cells and potentially delivers more drug, more precisely into the cell," Dr. Teper adds.

Mr. Selvaraju says companies like Immune with monoclonal antibody platforms are very much in vogue these days. "In the past few years, I can't think of any major, publicly traded monoclonal antibody-focused platform company that wasn't acquired by Big Pharma or Big Biotech for a substantial premium, even if those companies didn't have any products on the market.

"So there is a distinct possibility that in the long term, if Immune continues to meet its milestones, it could wind up going the same way."

(click to enlarge)

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. I have no business relationship with any company whose stock is mentioned in this article.