Seattle Genetics – Introduction

The market of monoclonal antibodies for cancer is one of the fastest growing segments in the pharmaceutical industry, with several blockbuster drugs such as Rituxan and Herceptin. Although over a year has passed since the FDA last approved an antibody for the treatment of cancer, the extensive activity in the field will surely lead to a substantial addition of antibodies in the coming years.


In parallel to this progress we believe that the industry is on the verge of a widespread adoption of the next generation of antibody–based platforms. These platforms, generally referred to as immunoconjugates, comprise of an antibody linked to an effector molecule, such as a chemotherapy drug or a radioactive isotope. As hybrid agents, immunoconjugates benefit from the advantages of the two moieties: The antibody moiety makes them very selective against cancer cells while the effector moiety confers strong potency.

Seattle Genetics (SGEN), one of the pioneers in the field of immunoconjugates, is shaping up to be a very important player in this field, thanks to its proprietary technology and extensive experience. The company uses its unique platform for coupling antibodies to chemo drugs, which result in very specific yet powerful Antibody-drug-conjugates [ADCs].

The market for ADCs is still in its infancy, which means that ADC development bears a higher risk compared to “naked” antibodies development. However, history has taught us that early entrance into a new disruptive market may be very rewarding, despite the obvious challenges. For the past several years, Seattle Genetics experimented with various types of immunoconjugate platforms that consumed a lot of time and money but failed to generate successful drug candidates. Today, after 2 ADCs powered by its technology showed impressive activity in phase I clinical trials, the company is better positioned than ever to lead the antibody industry’s migration from naked antibodies to immunoconjugates.

Obviously, Seattle Genetics is not the only ADC player in town, and there are also efforts among companies such as Wyeth (WYE) and Medarex (MEDX) to develop ADCs in-house. Nevertheless, being an ADC specialist may pay off in the coming years, as it will probably bring many companies, who would like to gain access to this lucrative market, to Seattle Genetics’ doorstep.

Seattle Genetics is a product-oriented as well as technology-oriented company. On the one hand, it develops its own antibody-based candidates while on the other, it licenses its products and ADC technology to 3rd parties such as Genentech (DNA) and Curagen (CRGN). In most cases, the partner has an antibody that can target cancer cells, but does not have sufficient clinical effect. Seattle Genetics can potentially boost an antibody’s activity by linking it to a potent drug.

Such licensing deals typically involve an upfront payment, milestone payments and royalties from future sales, in addition to the partner’s obligation to fully finance development costs. This strategy has become widespread among small and medium biotech companies, as it enables their involvement in a relatively large amount of projects, while keeping expenses low.

Ironically, most of the interest in the company revolves around a lucrative partnership it has with Genentech for one of its naked antibodies, and not because of the company’s promising ADC technology. However, a gradual shift in Seattle Genetics’ pipeline towards ADCs is likely to occur, with several candidates that are either independently developed or co-developed with its partners expected to be promoted into the clinic as soon as next year. we will review Seattle Genetics’ unique ADC technology, its clinical stage candidates , and the other 4 candidates (SGN-40, SGN-30, SGN-33, SGN-35 & CR011-vcMMAE) .



Author is long SGEN

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