Celyad: Early Stage CAR-T Company With A Different Approach

Summary

• Celyad is developing both an autologous and allogeneic CAR-T platform to treat both hematological malignancies and solid tumors.
• Its lead allogeneic product candidate is the first clinical CAR-T candidate used to treat a solid tumor.
• Despite the promise, the company has only generated very preliminary clinical data and still needs to prove the efficacy of its product candidates.
• With several upcoming milestones, investors with a higher risk appetite and long time horizon can consider to take up a small position.

Introduction

Celyad (CYAD) is a clinical-stage biopharmaceutical company, focusing on the development of CAR-T cell therapy for treating cancers. The company has both autologous and allogeneic technological platforms for CAR-T and has 2 international partnerships with Novartis and Horizon Discovery. In this article, I will cover Celyad’s clinical pipeline and progress and the company’s prospects for investments.

Clinical Pipeline

As briefly mentioned, the company is working on both autologous and allogeneic CAR-Ts, both platforms are NKG2DL-based and target both hematological malignancies and solid tumors. The full list of its clinical pipeline is listed in Figure 1.

Figure 1 Celyad’s Clinical Pipeline (Source)

NKG2D is an activating receptor expressed on natural killer (“NK”) cells which plays an important role in protection against infection and cancer. NKG2D binds to 8 stress-induced ligands and is absent or shows low expression in normal tissues and highly expressed in an array of hematological malignancies and solid tumors. NKG2D forms the basis of both Celyad’s lead autologous programs in hematological malignancies and allogeneic programs in solid tumors.

Autologous Platform

Under its autologous platform, CYAD-01 is the lead program being developed to treat relapsed/refractory (“r/r”) acute myeloid leukemia (“AML”) and myelodysplastic syndromes (“MDS”). There are currently 2 ongoing phase 1 clinical trial of CYAD-01 being conducted, the THINK and DEPLETHINK studies. The THINK trial is a dose-escalation trial assessing the safety and clinical activity of multiple CYAD-01 administrations without prior preconditioning chemotherapy while the DEPLETHINK trial is a dose-escalation trial assessing a single infusion of CYAD-01 following treatment with the preconditioning regimen of CyFlu.

In June 2019, the company announced that the FDA accepted its proposal to use a new manufacturing process for its ongoing and planned clinical development programs. The new proprietary manufacturing process, OptimAb, was found to drive improved anti-tumor activity in an aggressive leukemia model compared to the previous manufacturing process.

In December 2019, Celyad presented interim data updates from the CYAD-01 programs at the American Society of Hematology (“ASH”) Annual Meeting. In the THINK phase 1 trial, 16 patients have been enrolled to date evaluating CYAD-01 administered as a multiple injections with a biweekly schedule and an additional 9 patients enrolled in the weekly dose schedule. CYAD-01 without preconditioning chemotherapy was generally reported to be well-tolerated. Out of the 15 evaluable patients treated with CYAD-01 produced with the old manufacturing process demonstrated anti-leukemic activity. 5 out of the 8 patients show an objective response with 1 additional patient exhibiting disease stabilization of over 3 months.

For the DEPLETHINK trial, 9 patients have been enrolled in the trial evaluating CYAD-01 produced with the old manufacturing process following the preconditioning regiment of CyFlu at the first 2 dose level of the dose-escalation portion of the trial. CYAD-01 was generally reported to be well-tolerated following preconditioning chemotherapy. However, to date, no objective response has been observed at the first 2 dose levels of the trial in patients treated with CYAD-01 produced with the old manufacturing process. In September 2019, the company announced that the first patient was dosed with CYAD-01 produced with the OptimAb manufacturing process in the DEPLETHINK trial.

Moving forward, both the THINK and DEPLETHINK trials will evaluate CYAD-01 produced with the OptimAb manufacturing process. Preliminary data from both trials are expected to be presented by the end of the first half of 2020.

In addition to CYAD-01, the company is also developing the next generation of NKGD2D-based autologous CAR-T. CYAD-02 incorporates short hairpin RNA (shRNA) technology to target the NKG2D ligands MICA and MICB which translates to encouraging increases in vitro proliferation, in vivo engraftment and anti-tumor activity. CYAD-02 also incorporates the OptimAb manufacturing process thereby enriching for T cells with memory-like phenotype. In Jan 2020, the company announced that the first patient was dosed with CYAD-02 in phase 1 CYCLE-1 trial for r/r AML and MDS.

As a quick summary, there are 2 clinical assets under Celyad’s autologous platform being evaluated in 3 separate phase 1 trial, with multiple milestones in 2020, as shown in Figure 2.

Figure 2 Upcoming Milestones for Celyad’s Autologous Programs (Source: Investors’ Presentation)

Allogenic Platform

Beyond autologous, Celyad is also developing an allogeneic platform. Its lead allogeneic CAR-T candidate, CYAD-101, is in development to treat metastatic colorectal cancer (“mCRC”). CYAD-101 co-express the NKG2D receptor and TCR Inhibitory Molecule (“TIM). The expression of TIM leads to the competitive inhibition of CD3ζ and reduces signaling of the TCR complex, leading to the potential reduction or elimination of any signs of Graft versus host disease (“GvHD”), which is a common condition that might occur after allogeneic transplant, in patients treated with CYAD 101.

CYAD-101 is being evaluated in an ongoing alloSHRINK Phase 1 trial. Interim data was presented at the 2019 Society for Immunotherapy of Cancer (“SITC”) Annual Meeting in Nov 2019. There was no clinical evidence of GvHD observed following 35 injections of CYAD-101 and treatment with CYAD-101 was well-tolerated with no report of dose-limiting toxicity. There was also encouraging clinical benefit observed in heavily pre-treated patients who received a mean of 3 prior therapies, with 2 patients observing partial response and 7 patients with stable disease. CYAD-101 is the first allogeneic CAR-T clinical candidate for the treatment of a solid tumor.

Beyond CYAD-101, Celyad also has a partnership with Horizon Discovery to develop a novel shRNA-based allogeneic CAR-T. As briefly highlighted above, the shRNA platform has already been implemented in the autologous CYAD-02 program and the company continues to focus on the development of the technology in its allogeneic platform. Under the partnership, 3 product candidates are in preclinical development, with the most advanced being CYAD-211 which targets B-Cell Maturation Antigen (“BCMA”) for multiple myeloma and is expected to be filed for IND in the second quarter of 2020.

Figure 3 Celyad’s shRNA-based Allogeneic CAR-Ts (Source: Investors’ Presentation)

Prospects

As of 31 December 2019, cash and equivalents on hand were €39.3 million which the company expects to support all activities into the first half of 2021. There are also multiple upcoming milestones expected in 2020, with more data updates for all 3 autologous trials as well as further updates for CYAD-101. In addition, the submission of the IND application for CYAD-211 to start the clinical trial is expected in the second quarter.

Despite the undoubted promise of allogeneic over autologous platform as well as the fact that CYAD-101 is the first allogeneic CAR-T clinical candidate for the treatment of solid tumors, the clinical data generated for CYAD-101 are very early-stage with no complete responses and there remain questions on long-term efficacy as well as the fact that CAR-Ts have had limited success in solid tumors thus far.

In addition, data reported so far from the autologous programs so far are based on the old manufacturing process and it remains to be seen how the new OptimAb manufacturing process can help to improve efficacy.

Figure 4 Celyad’s Upcoming Milestones in 2020 (Source: Investors’ Presentation)

Competition

Celyad competes with several companies operating in both autologous and allogeneic CAR-T spaces. In the autologous space, the obvious names are Novartis and Gilead who have the first 2 approved CAR-Ts to treat lymphomas and leukemia. Bristol-Myers Squibb (“BMS”) (BMY) has also recently announced that the FDA has accepted the priority review of liso-cel which originated from Juno Therapeutics which was first acquired by Celgene and then in turn by BMS. The FDA has set a PDUFA date of 17 Aug 2020 for liso-cel.

Also, BMS is partnered with bluebird bio (BLUE) to develop bb2121 as an anti-BCMA CAR T for multiple myeloma. Both companies announced in Dec 2019 that the Phase 3 trial successfully met its primary endpoint and it is expected that the BLA will be filed in the second half of 2020. As there are other autologous CAR-Ts much further along in clinical development for hematological malignancies, Celyad will have to demonstrate that their NKG2D treatments can show better efficacy

There are also several companies competing to commercialize the first allogeneic CAR T. Such companies include Allogene Therapeutics (ALLO), Cellectis (CLLS), Crispr Therapeutics (CRSP) and Precision Bioscience (DTIL). The notable difference between the companies lies in their preferred choice of gene-editing platform. Allogene is partnered with Cellectis’ TALEN platform while Crispr is using its Cas-9 namesake and Precision is using the ARCUS platform. Celyad will have to demonstrate how its non-edited TIM platform and its shRNA-based technology can be different than its peers, although the fact that they are ahead in using CAR-T in solid tumors is encouraging.

There are also companies that are operating outside of only CAR-Ts. An example is Atara Biotherapeutics (ATRA) which is developing an Epstein-Barr Virus (“EBV”)-based allogeneic T cell therapy platform. Their lead program is in Phase 3 and a BLA filing is expected by the second half of the year. That should put them in the lead position of commercializing an allogeneic T cell therapy and the company is gradually moving into CAR T space as well.

In addition to healthy donors derived allogeneic therapies, Fate Therapeutics (FATE) is developing allogeneic therapies from induced pluripotent stem cells (“iPSCs”) as a renewable cell source. The advantage of this is that product consistency and potency will be improved, and the manufacturing process will be akin to the well-established biologics where they are produced from a single cell line. It is notable to note that Allogene is also developing a renewable cell source.

Beyond cell therapies, bispecific antibodies are also gaining prominence as an alternative to CAR-Ts. Bispecific are easier to manufacture compared and enables redosing, like biologics.

Conclusion

In this article, I covered Celyad’s clinical pipeline and its progress as well as its upcoming milestone and main competitors. While Celyad’s platform is promising, especially the CYAD-101 which is the first allogeneic CAR-T clinical candidate for solid tumors, the company has so far only generated very early-stage clinical data and I remain not fully convinced of the efficacy of their treatments.

I currently hold no position in Celyad but given that there are multiple milestones and readouts expected in 2020, investors who are willing to take up a speculative position could consider investing in Celyad, who is currently only trading at a market cap of 100+M, which is a huge discount premium to other CAR-Ts developers.

As always, investors should do their due diligence before taking up any positions and consider their risk profiles and time horizon, particularly with the recent market correction due to concerns over covid-19. I have covered several companies working on cell therapies and will continue to do so in the coming weeks and months.

Editor's Note: This article discusses one or more securities that do not trade on a major U.S. exchange. Please be aware of the risks associated with these stocks.

Analyst’s Disclosure: I am/we are long atra, BLUE. 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.

Comments

[User 879]

Excellent article and summary of existing car-t companies. I expect market consolidation and m&a activity with these names. PFE, JNJ, or GSK will eat these companies or buy and merge them.

[Tech Junkie]

Cheers.

Not all of the companies will succeed, a combination of clinical data not good enough, poor operational execution, run out of cash, poor commercial success possibility even if products get approved.

For those companies who do succeed, there's a high chance that they will be partnering with Big Pharma either in the form of being acquired, or a licensing deal.