Kite's CAR-T Therapy Positions For First-In-Class To Treat Lymphoma

| About: Kite Pharma (KITE)
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Summary

Kite is well-positioned to launch the first-in-class CAR-T therapy for NHL based on the positive 6-month readout of KTE-C19.

Juno contends for the best-in-class CAR-T therapy; Novartis competes in the same market.

Kite is well-funded through H1 2018.

Company overview

Kite Pharma, Inc. (NASDAQ:KITE) is a clinical-stage biopharmaceutical company that focuses on novel cancer immunotherapy to treat cancer. The company is developing a number of innovative products using chimeric antigen receptor (CAR)-engineered or T cell receptor (TCR)-engineered T cell to effectively target and kill cancer cells via a patient's own immune system.

The leading candidate KTE-C19 is currently in a pivotal trial (ZUMA-1) for the treatment of refractory, aggressive non-Hodgkin lymphoma (NHL), which includes diffuse large b-cell lymphoma (DLBCL), primary mediastinal b-cell lymphoma (PMBCL) and transformed follicular lymphoma (TFL). It is also evaluated in an expansion of indications of other hematological cancers. TCR-based therapy is investigated in the treatment of solid tumor, cervical and head & neck cancer in pre-clinical and early-clinical settings conducted by NCI.

Kite is well-positioned to launch the first-in-class CAR-T therapy for NHL based on the positive 6-month readout. Kite aims to complete the rolling submission of the Biologics License Application (BLA) for an accelerated approval of KTE-C19 in NHL in Q1 2017 and expects a PDUFA date in the same year. It will give Kite a leg up in the launch race with Juno and Novartis for the same indication.

ZUMA-1 updates

ZUMA-1 Ph1/2 6-month primary analysis showed 36% patients in complete remission (CR) and PMBCL/TFL group responded better than DLBCL group (figure 1).

Clinical design

ZUMA-1 is a single arm, open-label, multi-center, Phase I/II study to investigate the safety and efficacy of KTE-C19 in patients with chemorefractory aggressive NHL. A conditioning chemotherapy regimen of fludarabine and cyclophosphamide was administered to the patients followed by a single infusion of KTE-C19 at a target dose of 2*10^6 anti-CD 19 CAR + T cells/kg. Phase I was designed to evaluate safety measuring incidence of adverse events defined as dose-limiting toxicities (DLT) in 30 days.

Phase II uses objective response rate (ORR) per 2007 IWG criteria in 12 months as the primary endpoint. Secondary outcome measures included duration of response, progression-free survival (PFS), overall survival (OS), incidence of adverse events (AES) and levels of CAR-T cells and serum cytokines in the blood in a period of 12 months.

The trial enrolled 111 patients and they were divided into two cohorts based on tumor type: DLBCL (cohort 1) or PMBCL/TFL (cohort 2). A total of 101 patients received KTE-C19 treatment.

Combined results - ORR increased to 82% and CR to 54%; safety profile improved

The combined results of both cohorts (N=101) with minimum 6-month follow-up showed an ORR of 82% and CR of 54%. Both rates increased from month 3 with ORR of 79% and CR of 52%. Among these patients, grade>=3 cytokine release syndrome and neurologic events ((NEs)) were observed in 13% and 29% of the patients, respectively, compared to 18% and 34% at month 3. No cerebral edema was observed. Common adverse events included neutropenia, anemia, leukopenia, etc. 3 patients died and 2 of them were deemed KTE-C19-related.

Cohort 1 (DLBCL)- ~1/3 of the patients reached CR and maintained up to 6 months

The overall response (OR) in the 77 patients with 6-month follow-up was 36% and 31% of them reached CR compared to 33% at month 3, suggesting CR was durable. The primary endpoint of ORR increased to 82% from 76% from the previous time-point and reached significance (p<0.0001) compared to a historical control assumption of 20%. At 1-month follow-up, the ORR and CR were 68% and 33%, respectively. One thing to note is that CR across multiple time points (1-mo, 3-mo, 6-mo) did not seem to change much and was relatively stable.

Cohort 2 (TFL/PMBCL) - half of the patients reached CR, and KTE-C19 can potentially perform better in this subgroup

24 patients in this cohort achieved even better results at month 6 with an OR of 54% and a CR of 50%. There was also a higher percentage of patients that achieved CR among all responders in this cohort compared to the DLBCL group (71% vs. 49%) even though the ORR was similar (83% vs. 82%), suggesting KTE-C19 could be more effective in this subgroup of NFL. I note that the sample size was significantly smaller than cohort 1 so it might not hold true when incorporating the rest of the patients into analysis.

Figure 1. ZUMA-1 6-month follow-up readout. Source: Company presentation.

Competition from Juno and Novartis

Upon the positive readout, Kite is positioned to be the first-in-class CAR-T therapy in refractory aggressive NHL with planned submission of the BLA in 1Q 2017. Direct competitors in this indication include Juno's JCAR017, currently in Phase I, and Novartis' CTL-019 in Phase II for adult DLBCL patients. Kite will likely face significant competition assuming these products go on the market.

Juno contends for the best-in-class CAR-T in DLBCL indication

Juno's JCAR015 trial was suspended by the FDA last year after more deaths associated with the treatment. Another product, JCAR017 was advanced in replacement of 015 with a potentially improved safety profile to be the best-in-class. Compared to 015, which has CD28 as co-stimulatory domain, 017 is configured with 4-1BB domain whose metabolic profile supporting gradual and sustained expansion. In addition, the vector delivery was switched from retroviral to lentiviral.

Juno presented the early results of 017 in DLBCL and it showed remarkable potential despite of a small sample size (figure 2). At a lower dose level 1 (5*10^7), 42% (8/19) of the patients reached CR compared to the 33% CR rate achieved with KTE-C19 at 3 months. Dose level 2 (1*10^8) could potentially reach even higher CR and ORR and beat KTE-C19 if safety turns out to not be an issue.

Based on the safety data so far, no severe cytokine release syndrome was observed in all of the 22 patients and 14% of the patients displayed severe neurotoxicity. If this safety profile holds in 6 months or longer, 017 would have a much safer profile than KTE-C19 (At month 6, CRS was 13%, neurological events was 28%).

Juno is aiming to seek approval of 017 in 2018, which gives Kite a leg up in the launch race. It would be interesting to see Juno's results as its long-term data is coming up. Further comparison is needed to gauge its potential to be the best-in-class. If it turns out to outperform KTE-C19, Kite would face serious market competition.

Figure 2. Early results of JCAR017 in DLBCL. Source: Company presentation.

Novartis seeks approval of CTL019 in 2017

CTL019 is also a CD-19 targeted CAR-T therapy that is investigated in ALL, CLL, DLBCL and FL. It has the same costimulatory domain of 4-1BB as Juno's JCR017 and it is delivered using lentiviral. The DLBCL data was in 15 patients and at month 3, ORR was 47% with CR at 20%. At 6-month follow-up, CR improved to 40% with ORR decreasing to 40%. This result was largely in line with what we saw in KTE-C19 so far.

Compared to CTL019, patients treated with KTE-C19 seemed to reach CR earlier at month 3 and remained relatively stable through month 6. On the other hand, patients treated with CTL019 and reached partial remission (PR) at month 3 kept improving to CR at month 6 and all responders except one reached CR eventually. Severe CRS manifested in 13% (4/30) patients, which was also in line with Kite's results.

Novartis is seeking approval for CTL019 in ALL in 2017 and will likely expand the indication to NHL in the future, which poses a threat to Kite.

Figure 3. CTL019 results in DLBCL. Source: Company presentation.

CAR-T platform of Kite, Juno and Novartis

Kite's next generation CAR-T incorporates a reversible "switch" to control CAR activity with a small molecule.

Kite's next generation anti-CD19 CAR-T humanizes murine anti-CD19 CAR to reduce immunogenicity. It also incorporates a control element from Cell Design Labs that can precisely turn on and off T cell using a small molecule. The titratable tumor cell killing relationship between molecule concentration and % tumor cells killed was established. It can be very useful for improving safety and efficacy based on individual patient's condition (figure 4).

Figure 4. Illustration of the Control CAR design. Source: Company presentation.

Juno's JCAR017 utilizes a bispecific CAR technology to improve targeting specificity of cancer cells.

Juno's CAR-T uses either CD28 or 4-1BB as co-stimulatory signaling domain to amplify the activation of CAR-T cells just like Kite and Novartis. It also uses a bispecific technology which attaches a second binding domain on the CAR-T cells for either an inhibitory or amplifying signal depending on the antigens on the cancer cells or normal tissues. This configuration could increase the specificity of the targeting by reducing off-targeting.

Figure 5. Illustration of a bispecific domain in CAR T cells. Source: Company presentation.

Novartis's CAR-T platform is more similar to Juno

Novartis works with University of Pennsylvania and its anti-CD19 CAR-T cells have 4-1bb as its co-stimulatory domain, which is linked to CD3zeta/CD137 immunostimulatory domains. It also uses lentivirus as its delivery vector like Juno.

Academic Group

Company (Drug)

Costimulatory Domain

Vector Delivery

Indications

Dose

Phase

Approval

Upenn

Novartis (CTL019)

4-1BB

Lentiviral

ALL, CLL,DLBCL,FL

1- 5*10^8

PhIIa

2017 in ALL

MSKCC

Juno (JCAR015)

CD28

Retroviral

ALL, CLL,various B-Cell malignancies

Suspended

Fred Hutchinson

Juno (JCAR017)

4-1BB

Lentiviral

5*10^7

PhI

2018

NCI (NIH)

Kite Pharma (KTE-C19)

CD28

Retroviral

DLBCL

2*10^6

PhI/II

2017

Figure 6. Comparison of Kite, Juno and Novartis CAR-T therapies

Upcoming Catalysts and overview of the pipeline

Kite prepares to submit the BLA in 1Q 2017 and the PDUFA result will probably move the needle. Phase I data of ZUMA-6 testing KTE-C19 in combination with PD-L1 mAb in DLBCL patients is expected in 2017 as well. ZUMA-3/4 are advancing to Phase II and ZUMA-7 aims to advance into Phase III in the upcoming year.

Figure 7. Kite's rich pipeline and upcoming events

Market and Cash Position

Patients with relapsed aggressive NHL are those experiencing progression after initial treatment such as chemotherapy or stem cell transplantation and the relapse usually happens in the initial two years. In 2013, about 2.96 million people had non-Hodgkin lymphoma in the United States and 2.1% of people are affected at some point in their life. Currently, there is no curative treatment for patients with aggressive NHL who fail other treatments. CAR-T provides a promising approach to address this unmet market.

By the end of 2016, Kite had $414 million in cash, cash equivalents and marketable securities and no debt. The guidance for cash burn in 2017 is expected to be between $325 million and $340 million. It expects to have sufficient cash to fund its operations through 1H 2018.

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I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.