4SC: Baseline Patient Factors Predict OS Benefit

Baseline patient characteristics and the ZFP64 biomarker correlate with improved survival in liver cancer (HCC) subjects receiving resminostat. These findings will guide 4SC’s, (FSCGF) pivotal trial plans in front-line HCC. We are optimistic that 4SC can secure financing/partner to conduct the Phase IIb/III trial and model €789m peak sales. Our rNPV is unchanged at €122m.

ECCO presentation of resminostat data
We attended the European Cancer Congress (ECCO) where 4SC presented a subgroup analysis from the SHELTER Phase II trial in advanced hepatocellular carcinoma (HCC). The post hoc analysis showed that baseline patient factors and a blood-based biomarker, ZFP64 (zinc-finger protein 64), correlate with improved overall survival (OS) following resminostat. 4SC will incorporate these findings into its pivotal Phase IIb/III trial plans for the resminostat/sorafenib combination in HCC.

Baseline patient factors predict OS benefit
Baseline characteristics correlating with improved OS include good performance status (ECOG 0), absence of liver cirrhosis (Child-Pugh A) and lack of vascular invasion. We expect 4SC’s planned front-line Phase IIb/III trial in advanced HCC patients (BCLC stage C) to incorporate these findings as enrolment (Child-Pugh A) or stratification (ECOG, vascular invasion) criteria. Importantly, these criteria (BCLC-C, Child-Pugh A) mirror the clinical use of sorafenib in front-line HCC.

Increasing evidence for ZFP64 biomarker
High baseline ZFP64 levels (seen in c 60% of HCC patients) correlated with a significant (p=0.04) doubling of median OS vs low levels. Resminostat also down-regulated ZFP64 levels in peripheral blood of HCC patients, a finding confirmed by preclinical studies. This supports a link between HDAC activity and ZFP64 involvement in HCC cancer cell signalling. Although ZFP64 requires prospective validation, resminostat could become a targeted HCC therapy, with c 60% of patients stratified for treatment using a simple, blood-based companion diagnostic.

Valuation: rNPV remains at €122m
We value 4SC at €122m, or €2.41 per share, based on a risk-adjusted NPV analysis. Our rNPV includes resminostat at €108.5m, an indicative contribution from Phase I assets of €20m, year-end net cash of €4.5m, and deducts €11m of central costs. Potential Phase IIb development (vidofludimus) or divestment of non-core programmes (4SC-203, 4SC-207) would represent upside to our valuation.

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