After a two-month break here is a recap of key highlights from the September/October time frame. On the menu today: PD-1 controversies at ESMO 2016, Exelixis’ (EXEL) launch in renal cancer, gene therapy data from Abeona (ABEO), long awaited update from Esperion (ESPR) and a positive surprise from Seattle Genetics (SGEN).
ESMO 2016 – Merck wins by a landslide (for now…)
While ESMO is typically secondary in importance to ASCO, this year’s meeting overshadowed its US counterpart (which was relatively quiet to begin with…), generating big headlines in the PD-1 arena.
The biggest news from ESMO this year was the colossal failure of BMS’s Opdivo (nivolumab) in 1st line non-small cell lung cancer (NSCLC) amplified by positive data for Merck’s Keytruda (pembrolizumab) in a similar setting. Opdivo’s negative results had already been announced with the failure being blamed on BMS’s decision to use a lower PD-L1 expression cut-off compared to what Merck used. The surprising twist at ESMO was the lack of benefit even in high (>50%) PD-L1 tumors, which leaves Opdivo out of the lucrative 1st line market.
Source: Reck M. N Engl J Med. 2016 Oct 8
This was the first time Opdivo and Keytruda (which are considered interchangeable) behaved so differently in large controlled trials. While the reasons for this discrepancy are still unclear, most people still believe the reason for Opdivo’s lack of benefit in PD-L1-high patients is more related to trial design and biomarkers rather than an inherent difference in their biological effect.
Roche added to the confusion with its OAK data in 2nd line NSCLC. As with other PD-1 agents, clinical effect improved with PD-L1 expression but in contrast to data with Keytruda and Opdivo, Rohce’s PD-L1 antibody Tecentriq (atezolizumab) improved survival across all subsets, including those with limited to no PD-L1 expression. Again, it isn’t clear whether this is a matter of patient selection or a true advantage PD-L1 mAbs (or just Tecentriq for that matter) have. Regardless, this is good news for Roche who will be well positioned to address patients who are not eligible for Keytruda 1st line due to low PD-L1 expression.
Merck’s and Roche’s wins over BMS improve their near-term market positioning but a batch of combination readouts next year may reshuffle the deck once again.
Focus shifts to combinations data in 2017
While Keytruda’s survival benefit (HR=0.60) is impressive especially given the fact that 50% of patients in the control arm crossed over to receive Keytruda, it is important to note that:
A – Keytruda is not curative and the vast majority of patients eventually progress
B – While ~25% of 1st line NSCLC patients have >50% PD-L1 levels, it is estimated that in real life only ~15% of patients will be eligible for Keytruda as the label has additional restrictions (background diseases, some cases of brain mets, specific driver mutations etc.)
In order to treat a larger portion of NSCLC patients companies are evaluating combination regimens that may potentially cover patients regardless of PDL1 status. The first wave of combination studies in NSCLC is divided to IO/IO (PD-1 + CTLA4) and IO/chemo.
IO/IO – BMS and AstraZeneca will report P3 data from their respective IO/IO combinations in 1H:17. This is BMS’s next opportunity to regain its leadership position in the NSCLC market which is predicted to be worth ~$20B globally. The company’s combination (Opdivo+Yervoy) is already approved in melanoma and each agent is clinically validated as monotherapy. This is not the case for AstraZeneca’s combo (durvalumab + tremelimumab) which comprises two investigational agents, making the study riskier. Durvalumab targets PD-L1, which may or may not have the same effect as PD-1 antibodies like Keytruda and Opdivo. Tremelimumab, which was licensed from Pfizer, failed a P3 trial in melanoma (in contrast to BMS’s Yervoy) but it’s unclear whether the failure was related to trial design or to an inferior clinical effect.
At the meeting, BMS presented updated data from a combination trial, boasting a high response rate (43% for all patients improving up to 92% in high PD-L1 expressers) and a higher than expected rate of complete responses.
IO/chemo – Merck and Roche are pursuing 1st line NSCLC by combining their PD-1/PD-L1 agents with various chemo regimens. To date, data from multiple studies demonstrated a variable response rate with some cohorts demonstrating numerically higher than expected response rates. In contrast to BMS and AZ, Merck and Roche don’t have a CTLA-4 antibody in late stage development which may have contributed to their decision to choose chemotherapy. It is important to note that all four companies are pursuing other IO/IO combinations in earlier stage studies.
At ESMO 2016, Merck presented the first randomized data which support the IO/chemo approach. Keytruda+chemo was superior to chemo alone in terms of response rate (55% vs. 29%) and PFS (13 vs. 8.9 months). OS data were still immature at the time and did not show a meaningful difference. These findings are positive and bode well for the combinability of PD-1 and chemo but they do not answer the more important question of combination vs. sequential treatment given the lack of a clear answer on OS.
Roche is running four P3 trials with a variety of chemo regimens, data from which is expected to come out in 2017. Merck initiated a P3 of chemo with or without Keytruda in January 2016, which might have PFS data towards the end of 2017. In most of these studies, the primary endpoint is PFS (which should be available in 2017). As most patients in the control arm are likely to receive a PD-1 agent upon progression, generating an OS signal may prove challenging.
Still looking for the next PD1
Several years passed since the initial efficacy signals with PD-1 inhibitors which led many to hope that by this time there would be several additional effective IO agents. Unfortunately, this hasn’t materialized despite an industry-wide effort spanning tens of new agents that entered the clinic in the past 3 years. Clinical activity with new IO agents (LAG3, KIR, 4-1BB, OX40, TIM3, IDO, CD27, CD73, CSF1R etc.) has been modest at best, so these agents are now being explored in combination with PD-1/L1 antibodies.
To date, data from these combinations have been scarce and predominantly underwhelming. At ESMO, Incyte (INCY) reported results for its IDO inhibitor (epacadostat) when added to Keytruda. Although response rate and PFS in melanoma were numerically higher than what is expected with PD-1 monotherapy, the data are hard to interpret given the low sample size (n=19) and the less encouraging activity in other indications.
Many combination trials are expected to read out in 2017, including a P3 study of epacadostat + Keytruda in melanoma.
Exelixis off to a strong launch in RCC
At ESMO, Exelixis reported the long anticipated data in 1st line renal cancer (CABOSUN study), where Cabometyx beat standard of care drug, Sutent. This makes Cabometyx the only drug to show superiority over Sutent and although the trial was a P2 of 157 patients, it may be enough for approval. Two recent precedents for an approval in oncology based on P2 is Lenvima in RCC and Lilly’s Lartruvo in soft tissue sarcoma.
Last week, Exelixis reported its quarterly results which included the first full quarter since Cabometyx’s approval (April 2016). The cabo franchise (Cabometyx for RCC and Cometriq for medullary thyroid cancer) generated sales of $43M, of which $31M were for Cabometyx. According to Exelixis, in Q3 Cabometyx had a market share of 20% and 35% in new 2nd and 3rd line RCC patients, respectively. This is encouraging especially given Opdivo’s simultaneous launch in 2nd/3rd line RCC.
Cabometyx and Opdivo should continue to take market share from legacy products such as Afinitor and Inlyta but also expand the overall market (more patients receiving treatment, more treatment lines, longer treatment duration). The ultimate goal for both agents is 1st line approval. BMS is running a large P3 (1000+ patients) for Opdivo+Yervoy vs. Sutent that should have data in H2:17. Exelixis hopes data from CABOSUN will be enough for accelerated approval potentially towards the end 2017.
Regardless of 1st line market dynamics, it is clear Cabometyx is still far from saturating the market. Even if Opdivo+Yervoy becomes the dominant 1st line option, Cabometyx will probably dominate the 2nd/3rd line market as it will be regarded as superior to every other approved agent. Last quarter’s run rate (~$120M annually) demonstrates that Cabometyx can easily become a $500M product in the US alone without any label expansions. For the sake of comparison, Pfizer’s Inlyta, which demonstrated limited efficacy in 2nd line RCC (median PFS of 4.8 months and no survival benefit), had peak US sales of ~$210M.
The Cabometyx and Cotellic programs are starting to generate preliminary combination data with PD-1 agents. At ESMO, Exelixis reported encouraging signs of efficacy for Cabometyx+Opdivo in patients with various genitourinary tumors, including a response rate of 43%. The signal appears particularly strong in bladder cancer (both urothelial carcinoma and SCC of the bladder) but it is hard to distinguish between cabo’s contribution and that of Opdivo, especially without PD-L1 expression data.
For Cotellic, Genentech is pursuing combination studies with its PD-L1 agent, Tecentriq, across different indications. In 2017, there will be three pivotal trials in colon cancer and melanoma based on encouraging combination results. Most recently, Genentech reported a 50% response rate in BRAF-negative melanoma with a good duration of response. Genentech’s efforts are clearly a positive indication and provide potential upside for Exelixis, which has co-promotion rights for Cotellic in the US, but until P3 data are available in 2-3 years, the drug is unlikely to contribute significant sales to Exelixis.
Abeona reports preliminary promising data
As followers of this blog know, I am a strong believer in gene therapy and hope it will become the industry’s primary growth driver in the coming years. Based on the limited data package we have, gene therapy has clinical validation in liver diseases (hemophilia as a proof of concept) and genetic retinal diseases (RPE65 as a proof of concept).
Neurology is an emerging domain for gene therapy thanks to preliminary but provocative data from Avexis (AVXS) in SMA. Avexis’ results suggest its AAV9 gene therapy treatment leads to a remarkable clinical benefit in an otherwise fatal disease but so far there is no proof that the missing protein is actually generated in the CNS.
Last month, Abeona (ABEO) took the field one step further by demonstrating promising hints of activity in another neurologic disease, MPSIIIA (also known as Sanfilippo Syndrome A). MPSIIIA is characterized by elevated levels of certain sugars (GAGs) in the body (including the brain) caused by a mutation in an enzyme responsible for their degradation. In contrast to Avexis, which did not present biomarker data, Abeona presented direct evidence that its gene therapy may actually reach the CNS and lead to a reduction in GAGs.
Source: Abeona Therapeutics
The data set included three patients who were given a single administration of ABO-102 and followed up for one month. Despite the limited follow up and the relatively low dose (5 X 1012 vg/kg) patients had a 25% reduction in GAG in the CSF (which mirrors levels in the brain) and a significant 57.6% reduction of GAGs in the urine. These biomarker reductions were accompanied by ~17% reduction in liver and spleen volume. These changes are comparable or better than the effect seen with other treatments in related diseases. For example, Alexion’s (ALXN) enzyme replacement therapy for MPSIIIB led to a ~10% reduction in CSF-GAG following 3 months of treatment.
Source : Alexion
Abeona’s data are very preliminary but coupled with Avexis’ clinical data imply that AAV9 can cross the blood brain barrier and produce significant amounts of protein. The main issues remain durability and corroborating the signal in additional patients. Long term safety is also a concern which will take years to answer.
Abeona’s data should be regarded as a positive read-across to REGENXBIO (RGNX), which holds key patents for AAV9 vectors and has two preclinical AAV9 programs for MPSI and MPSII (INDs expected in 1H:17).
Esperion – Another overhang removed
Esperion (ESPR) reported yet another data set that showed its drug, bempedoic acid (ETC-1002), leads to reduction in LDL-C and CRP. The study, which evaluated ETC-1002 in combination with high-dose of statins, demonstrated a placebo-adjusted LDL-C reduction of 22%, in line with prior studies, although the absolute decrease from baseline was relatively modest (13%). This means some of the effect was driven by increased LDL-C in the control group, which is not unheard of after 4 weeks of treatment and can be attributed to lifestyle changes. Safety profile was in line with prior experience but the treatment arm had more adverse events that so far appear manageable.
Source: Esperion Therapeutics
These results are important because they address concerns about drug-drug interactions with statins and ETC-1002’s ability to have an effect when the cholesterol biosynthesis pathway is significantly inhibited (evidenced by the low LDL-C baseline levels). They also demonstrate a favorable safety profile that needs to be further validated. Following discussions with the FDA, Esperion is now pursuing ETC-1002 in combination with any statin dose in its pivotal program.
Investors remain unimpressed with the data and the stock is traded below its Q3 cash position, despite having an imminent P3 program with sufficient runway to generate data in 2018. The negative sentiment stems primarily from the disappointing launch for PCSK9 antibodies, as physicians are waiting for cardiovascular outcomes trials (CVOT). Investors rightfully assume that this will also be the case with ETC-1002, especially in light of the more modest LDL-C effect. Lack of long term safety profile and lack of regulatory clarity around LDL-C reduction as an approvable endpoint also weigh on the stock.
Esperion’s near-zero enterprise value may turn it into a potential acquisition target. Despite the high risk, ETC-1002 is the only oral LDL-C and CRP reducing agent in P3 with a >$1B market potential under conservative assumptions.
Pleasant surprises from Seattle Genetics
At ESMO 2016 there were three positive data sets for novel ADCs, which is refreshing after a long period of setbacks and failures in the ADC field.
Seattle genetics (SGEN) and its partner Astellas reported impressive efficacy with two under-the-radar programs, ASG-22ME (anti- Nectin4 ADC) and ASG-15ME (anti- SLITRK6) in bladder cancer. The two ADCs demonstrated a 31%-33% response rate in the entire P1 population, which improved to 50%+ in patients who received the highest dose. These response rates compare favorably with the 15%-25% response rate typically seen with PD-(L)1 antibodies. Responses were seen in PD-(L)1 failures with a similar response rate to that observed with PD-(L)1-naïve patients, which may open the door for accelerated approval in last line patients (if efficacy is corroborated by a single-arm P2 study).
Daiichi-Sankyo presented encouraging results for its anti-HER2 ADC, DS-8201a, in HER2+ breast and gastric cancers. Response rate was ~32%, including a 42% rate in breast cancer patients who had been treated with Kadcyla (Roche’s anti-HER2 ADC powered by Immunogen’s (IMGN) technology). In contrast to most other ADCs in development, DS-8201a utilizes an uncommon mechanism for its payload (topoisomerase I inhibitor). While this payload appears less potent than tubulin or DNA binders, it appears to have a broader therapeutic window based on the high dose (8 mg/kg) that was administered without dose-limiting toxicities.
Portfolio holdings – November 6th, 2016