3 Companies With Three Different Approaches To Immuno-Oncology

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Includes: BMY, CELG, JUNO, VBIV
by: Samuel Rae

Summary

Immuno-oncology has revolutionized cancer treatment and is likely to continue to do so for the foreseeable future.

Many companies are developing assets in the space, most of which have different mechanisms of action.

Here are three, each with a different approach, each targeting a different type of cancer.

Over the last ten years, immuno-oncology has revolutionized cancer treatment. The ability to harness a cancer patient's immune system as a tool with which to kill cancer cells has long been sought-after, but only recently has it become a mainstream reality. Companies large and small are working to apply the principles of immuno-oncology to all sorts of cancer types and many have found success in their efforts.

Here is a look at three companies approaching cancer using immuno-oncology principles in three very different ways and in three very different cancers.

The companies that will form the basis of this discussion are VBI Vaccines (NASDAQ:VBIV), Bristol-Myers Squibb (NYSE:BMY) and Celgene Corporation (NASDAQ:CELG).

VBI Vaccines

VBI is developing a treatment for glioblastoma multiforme (GBM) called VBI-1901. GBM is the most common and deadliest form of brain cancer with around 12,000 individuals diagnosed with this form of the disease in the US every year. The current standard of care treatment for GBM patients is surgical resection followed by radiotherapy and chemotherapy, but even when the cancer is caught early, this regimen is not particularly effective. Without treatment, people with glioblastoma typically die within three months. Today's median survival rate comes in at around 15 to 16 months, which is only a small improvement on the 12 months' median survival rate of 30 years ago. The space is crying out for fresh treatment options and VBI is attempting to answer this request with VBI-1901.

The drug's mechanism of action is pretty elegant.

It's a cancer vaccine, which is designed to stimulate an immune response against the GBM cells in a patient's brain. As a bit of necessary background, the way vaccines work is by recognizing what's called an antigen, which is a protein expressed by a bacteria or virus and is recognized by the immune system as foreign. On recognition, it can stimulate the production of antibodies, which coordinate the immune response. The idea behind vaccination is that a person's immune system becomes predisposed to the antigen expressed by the virus (through a form of the antigen expressed by the vaccine) and is able to build up a store of antibodies ahead of any infection with the real thing.

With VBI-1901, VBI has taken this concept and carried it a step further.

Research has revealed that GBM cells express an antigen associated with the CMV virus. The idea behind VBI-1901 is to teach the immune system to recognize this antigen as pathogenic, and in doing so, direct it to attack any GBM cells that express it. In other words, the treatment essentially tricks the immune system into thinking that the GBM cells are CMV virus cells.

It's an early-stage asset, and the company anticipates filing an Investigational New Drug (IND) application with the FDA in the first half of this year, which will (if approved) lead to the subsequent initiation of a phase I/IIa clinical trial in patients with GBM. As per a pre-IND meeting between VBI and the FDA, the latter will consider a Fast Track designation at the time of the IND submission.

It's worth noting that VBI isn't a direct immuno-oncology play. The company has a number of development and commercialization programs underway, most notably a hepatitis B asset called Sci-B-Vac. The asset is approved in certain regions globally and VBI is pushing for approval in Europe and the US near term.

Bristol-Myers Squibb

This one is a different sort of play to VBI. Its inclusion in this list is rooted in an already approved asset called Opdivo, or nivolumab. The drug is approved in the US for a range of oncology indications, including melanoma, squamous non-small cell lung cancer and renal cell carcinoma. It also just picked up an approval in Europe for the treatment of patients with head and neck squamous cell cancer.

Again, this one's mechanism of action is well worth discussing. The drug is part of a family of drugs called immune checkpoint inhibitors. When a patient has cancer, the cancer cells do a range of things that help them avoid detection by the immune system. One of these things is to send out a signal which essentially turns off the T cells that would otherwise respond to the cancer's presence. Opdivo is designed to switch back on the T cells that the cancer cells have switched off. Once activated, these T cells then go about inducing apoptosis in the cancer cells in question.

One of the major benefits of Opdivo, when compared with traditional chemotherapy type treatments, is that it's very quick to administer (30 minutes IV once every couple of weeks at standard dosing) and doesn't bring about the pain, tiredness, and sickness associated with chemotherapy. It does have some of the side effects (gastrointestinal and skin disorders seem to be the primary complaints) but for the patient being treated, these are generally well worth bearing given the added survival time brought about by the drug.

Bristol-Myers Squibb generated $1.7 billion from sales of Opdivo during the final quarter for 2016 (the most recently reported period) and, with the above mentioned European approval in place, this should increase as 2017 matures.

The catalysts to watch going forward for Bristol-Myers Squibb, and specifically for the company's Opdivo program, are rooted in the company's efforts to pick up an approval as a combination therapy with a drug called Yervoy in first-line non-small cell lung cancer (NSCLC). The program was set back slightly recently when the company announced it wouldn't be seeking accelerated approval for the combination, but there's still an expected approval period mid to late 2018, and a number of submission related catalysts should hit press as this period approaches.

Celgene Corporation

Celgene qualifies for inclusion on this list through a collaboration with Juno Therapeutics Inc (NASDAQ:JUNO). The company has its own immuno-oncology programs, but the one on which the Juno collaboration is based looks to have far more potential in terms of near-term value and so that's what we'll discuss here.

The asset is called JCAR017 and it's currently under investigation as part of a program set up to investigate safety and efficacy in for relapsed/refractory diffuse large B-cell lymphoma (DLBCL). For those new to the condition, it's a cancer of B cells, which are a type of white blood cell responsible for producing antibodies. It is the most common type of non-Hodgkin lymphoma among adults, with an incidence rate of 7 cases per 100,000 people per year.

The current standard of care is chemotherapy, but unlike the GBM that VBI is targeting with its own immuno-oncology asset, DLBCL has a relatively high rate of survival. A combination of chemotherapy and radiation therapy can cure 50-80% of patients, with this number rising to as high as 90% in patients without any additional risk factors.

With this said, however, there's still a large demand for fresh treatment options, especially in the relapsed population that Celgene and Juno are targeting with JCAR017. An improved tolerability profile (which is not that difficult to achieve when you're up against a chemotherapy standard of care) makes this asset attractive to patients, and the drug would also represent a treatment option for the relapsed population that have little to no alternatives when chemotherapy has failed.

So how does this one work?

The drug is what is called a CAR-T treatment, which targets CD19. CD19 is an antigen that is expressed (primarily) by B cells. CAR-T assets are engineered T cells, which a company engineers to make them recognize a particular antigen. When they recognize the antigen towards which they have been directed, they initiate an immune response and kill the cells that express said antigen. With JCAR017, Juno and Celgene have engineered the T cell to recognize CD19 because of its high expression on the cancerous B cells that characterize this type of cancer.

Further, it's not just a DLBCL target. In March, Juno put out some DATA from a phase I study investigating the drug in another target indication, CD19-positive non-Hodgkin lymphoma (NHL). In the trial, the drug demonstrated an objective response rate (ORR) of 80% and a complete response (CR) rate of 60%. It was an early stage (and therefore small) study, but these are strong numbers nonetheless.

Which brings us to the catalysts for this one. The company plans to initiate a pivotal trial in the DLBCL indication at some point during the second half of this year. We should also see a phase II kick off in NHL. Both events (with slightly more emphasis on the former) have the potential to draw speculative capital on initiation, as traders and investors take a position in both Juno and Celgene anticipation of a strong performance.

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 (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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