Big Moves For Micro Sesen Bio In The Near Future - An Update

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About: Sesen Bio, Inc. (SESN)
by: Ting Peterson
Summary

Sesen Bio is on track for filing the Biologics License Application (BLA) for its lead drug candidate Vicinium.

Sesen Bio’s CEO expressed strong confidence of FDA approval.

The National Cancer Institute is conducting a trial to assess combination therapy with Vicinium.

The company plans global commercialization of Vicinium.

The relatively simple manufacturing process should be advantageous in terms of cost and quality control.

On March 4, Sesen Bio's (SESN) President and CEO Dr. Thomas Cannell held a conference call, primarily to update the status and progress of Vicinium.

A Brief Background

Vicinium is being developed for non-muscle invasive bladder cancer (NMIBC), a very common cancer for which no new treatment has been approved in 20+ years and represents an urgent unmet need. While Bacillus Calmette-Guerin (BCG) is approved for treatment of NMIBC, it will eventually fail most patients. Complete removal of the bladder is recommended once BCG is no longer effective. Valstar (Valrubicin), the third line of defense, is only prescribed for those patients who cannot withstand the surgery.

BLA Submission and FDA Approval

Dr. Cannell revealed that, during a recent call, the Federal Drug Agency (FDA) requested a pre-BLA meeting in mid-2019. The foci of the meeting are to make certain that the Agency has all the necessary elements and to discuss the successful transfer of technology to Fujifilm, the company contracted to provide the commercial supply of Vicinium, to ensure that product quality and integrity are maintained. The company engages in close, in-depth communication with the Agency, and "…are sharing everything with the agency… preparing all of the data for the agency". He restated his confidence of the likelihood of FDA approval, as the Phase 2 and Phase 3 clinical trials were designed based on close collaboration with, and continuous input from, the Agency. Furthermore, he emphasized that Vicinium's favorable risk/benefit ratio presents a strong basis for approvability per FDA guidance.

Commercialization Considerations

In setting the foundation for the overall go-to-market strategy, the company has begun preliminary market research among patients, physicians, and payers. As a result of interviews ranging from 1 to 3 hours, prescribing urologists stated they would prescribe Vicinium to approximately 60% of their BCG unresponsive, high-risk NMIBC patients, while key opinion leaders said they would recommend Vicinium to about 70% of their colleagues. All prescribing physicians interviewed rated Vicinium's dual mechanism of action (direct cancer cell kill and activation of the immune system) ten out of ten for relevance and importance.

As Vicinium is being developed for patients whose disease no longer responds to BCG, the ease of transition from BCG to Vicinium should result in quick adoption of Vicinium at its launch. Patients will continue receiving care at the same treatment center, remain with the same urologists and nurses, have Vicinium administered by the same type of urinary catheter used with BCG, and continue with the same lab tests. The company feels "there is an opportunity for strong and sustained growth after gaining regulatory approval" because of the smooth transition from first-line BCG to second-line Vicinium.

It is significantly simpler to manufacture Vicinium than BCG, the current gold standard of care for NMIBC. In fact, the complexity and exacting nature of the BCG manufacturing process led to Sanofi's (SNY) plant shutdown and shortages of Merck's (MRK) TICE strain due to contamination. According to Dr. Cannell, the relative simplicity of Vicinium's production has the potential to significantly reduce cost of goods and create a simple, reliable, and efficient manufacturing supply chain.

Dr. Cannell believes this could be a "unique market dynamic" where all the key customer segments are aligned as advocates for Vicinium's success. Commercial payers and Medicare expect to benefit from reduced overall healthcare cost; patients and care-givers will obviously benefit from avoidance or delay of cystectomy and disease progression; and doctors will have the opportunity to help patients maintain their quality of life.

National Cancer Institute Clinical Trial of Combination Therapy

The National Cancer Institute (NCI) is conducting a clinical trial to assess the combination therapy of Vicinium and AstraZeneca's (NYSE:AZN) Durvalumab. If the scientific hypothesis, that Vicinium's immune system activation facilitates Durvalumab's checkpoint inhibitor mechanism, bears out, Vicinium has the potential to be the preferred choice for combination therapy with checkpoint inhibitors - a valuable alternative for patients who do not achieve complete response on either BCG, or Vicinium as a monotherapy. Currently in Phase 1, the primary completion and study completion dates are 7/1/2020 and 7/1/2021, respectively.

Vicinium targets cancer cells that express an antigen known as EpCAM, thus the drug has the potential to address many other types of cancers that also express EpCAM, particularly if its synergistic relationship with checkpoint inhibitors is confirmed. Data from this NCI trial is expected to guide additional combination studies.

Globalization

Global demand for effective NMIBC treatments far exceeds that of the U.S., which accounts for about 20% of the worldwide market. The CEO disclosed that the company has been actively seeking and conducting discussions with potential partners outside the U.S. He foresees partnering with 6 to 10 companies locally situated in foreign regions to cover 60 to 80 countries outside the U.S. Collaborating with strong local companies facilitates the entire process from submission to approval, as they have much closer relationships with regulatory agencies in their region. He expects, from experience, 6 to 12 months to complete the partnering process, per Dr. Cannell "…I think around the time of BLA submission, really that process will accelerate, we will be able to finalize some of those partnership agreements…" He further predicts, from his experience, some regions will require additional clinical work, but FDA or European approval will be sufficient for many markets.

Continued Safety and Tolerability

Vicinium's safety profile remains positive and consistent with Phase 2, attributable at least in part to the drug selectively and directly killing cancer cells while generally sparing normal ones. Safety is among the FDA's chief concerns and considerations for drug approval. Vicinium also continues to be well-tolerated by patients. Dr. Cannell commented that some patients even questioned whether they were being treated with Vicinium because of the lack of unpleasant side-effects.

Phase 3 VISTA Trial Cohort 3 Preliminary Data-Vicinium's Strong Anti-Tumor Activity

In January, Sesen reported strong, positive data from the trial. Vicinium was found to be effective against the most difficult-to-treat cases patients in cohorts 1 and 2 with carcinoma in situ (CIS), a high-grade, aggressive NMIBC which grows flat on the inner lining of the bladder that cannot be resected (cut out). At that time, the company elected not to discuss cohort 3 - patients whose high-risk disease had progressed to tumor stages Ta or T1 without CIS, perhaps because of FDA guidance that these patients be excluded from evaluation of the primary endpoint. Although cohort 3 data will not factor into the primary endpoint, the results demonstrate impressive anti-tumor activity and support Vicinium's strong safety profile. Cohort 3 Complete Response Rates (CRR) presented during the March 4 conference call were 68%, 56%, 42%, and 36% at 3, 6, 9, and 12 months, respectively. Cohort 3 patients (with cancerous tumors) differ from those in cohorts 1 and 2 (cancer that grows flat), but the next recommended course is no different for all 3 cohorts - radical cystectomy.

The potent anti-tumor activity observed in VISTA's cohort 3 patients is consistent with the findings of Sesen's Phase 2 clinical trial of Squamous Cell Carcinoma of the Head and Neck (SCCHN).

Robust and Durable Efficacy

Duration of response is a primary endpoint measure. Median duration of response for cohorts 1 and 2 is 227 days and 267 days, respectively, using the Kaplan-Meier method. Additional analysis of pooled data shows that among those patients who achieved a complete response at 3 months, 69% and 49% had a complete response duration of 6 months or longer and 9 months or longer, respectively. There was no discussion of the cohort 3 data, presumably because those patients were excluded from primary endpoint evaluation by FDA guidance.

Time to disease recurrence is a key secondary endpoint for patients in cohort 3 with high-grade papillary-only (Ta and T1) NMIBC (without CIS). The median time to disease recurrence is 270 days based on the Kaplan-Meier estimate.

Time to cystectomy is a key second endpoint in the VISTA Trial. As reported on the 12-31-18 SEC Form 10-K, the projected median cystectomy-free time for all 133 patients treated with Vicinium is approximately 18 months. The number of cystectomies as yet has been so low that a meaningful median time to cystectomy cannot be established, thus the median was estimated using a computer-based, intensive, nonparametric approach commonly used in clinical data sets that are incomplete. The company is working closely with the FDA on how to conduct these analyses. Notably, no patient developed metastatic bladder cancer during treatment in spite of the delay in cystectomy.

Cash Position

The company reported cash of $50M on its 12-31-18 SEC Form 10-K, which is expected to fund operations into 2020.

Vicinium Vs. Valstar?

Additionally, I have received a number of requests to compare Vicinium to Valstar. I feel the dissimilarities between the 2 drugs are far too vast for any relevant comparison, but I will discuss a few salient points. It would seem obvious that Valstar's safety profile would be significantly inferior to Vicinium's, as Valstar is a chemotherapy agent that penetrates both cancer and healthy cells, whereas Vicinium specifically targets cancer cells. Dr. Cannell referred to 4 deaths from metastatic bladder cancer during the Valstar trial that were reported in the drug developer's original submission to the FDA. There have been no cases of metastatic bladder cancer in Vicinium's Phase 2 or Phase 3 clinical trials, as mentioned above. Vicinium is being developed to replace cystectomy as a second line of defense. In sharp contrast, Valstar is prescribed after BCG failure only when the surgery is not an option because of unacceptable morbidity or mortality - as the third line of defense. Compounding the challenge of comparing the drugs' efficacy is the use of very different criteria because Valstar was developed 20 years prior to the FDA's official guidance. At the time of Valstar's original FDA application, the Agency validated only 7 of Valstar's complete responses at 6 months. Eventually, the FDA classified 9 as complete responders and conceded to 7 as potential complete responders, for a response rate of 18% at 6 months, significantly lower than Vicinium's 27% for the same time span.

Risks

Finally, I feel it is critical to remind readers, particularly those considering investing in Sesen Bio, that major players in the pharmaceutical field are in various stages of development to address this disease with much unmet need - with the herculean Merck in their midst. While Sesen's Vicinium is far ahead in clinical trial stages of any other treatment options for NMIBC, there are no guarantees that other treatments will not, in time, surpass Vicinium's efficacy. In the interim, the elderly patients with this horrific disease should be given the opportunity to enjoy their golden years with their bladders intact. Although there are many factors pointing to the likelihood of FDA approval, the Agency has not always been predictable or logical. Lastly, Vicinium faces potential competition from biosimilars, as does any other drug.

As this is only an update, I have attempted to avoid undue repetition and redundancy from my previous write-up. For those who want more background, details and in-depth analyses, please refer to "Why Institutions Own 48% of Tiny, Obscure Sesen Bio", an article I recently wrote.

Disclosure: I am/we are long SESN. 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.