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Cancer Immunotherapy Investing: It's All About The Right Technology

Published 09/17/2015, 03:49 AM
Updated 07/09/2023, 06:32 AM

For many decades, cancer therapy research has failed or, best case, has led to only marginally effective therapies for most types of cancer, which explains why many investors and even clinicians have lost faith in seeing any substantial advance made in the near future. Today, with the data accumulating from clinical trials, there is no doubt that immunotherapy will change our perspective on cancer treatment and give hope to the millions of patients diagnosed with different cancers every year.From a financial point of view, cancer immunotherapy is definitely one of the most exciting fields to invest in for the next decade, and despite the underlying risk, many investors are willing to take the early bird strategy in order to most benefit from the high growth potential.

In this article I will try to give summarize some scientific background to help understand the different current approaches in the cancer immunotherapy, and enable readers to make more informed investing decisions. In this article, I will concentrate on three questions which are, in my opinion, the most important for any biotech investor:

  • First: which companies are adapting the approaches with proven efficacy from clinical trials?
  • Second: which approaches are more likely to deliver a cost effective treatment to the market?
  • Third: in which approaches are safety related disappointments less likely?

These questions will be discussed regarding the main approaches biotechnology companies have adapted to beat cancer, which are: CAR T-cells, enhanced affinity TCRs, cancer vaccines and checkpoint inhibitors. Please note that this article will only consider the growth companies listed under Loncar cancer immunotherapy index. Chimeric T cell antigen receptor (CAR T-cells): Developing companies: ZIOPHARM Oncology Inc (NASDAQ:ZIOP), Kite Pharma (NASDAQ:KITE), Juno Therapeutic (NASDAQ:JUNO), Bluebird bio Inc (NASDAQ:BLUE), Cellectis SA (NASDAQ:CLLS) and Bellicum Pharmaceuticals Inc (NASDAQ:BLCM).

In this approach, human T-cells are genetically modified to have an engineered receptor that recognizes a specific molecule on the surface of tumor cells, these T-cells will subsequently attack and destroy the cancer cells. From the few clinical trials conducted in the last three years, this type of immunotherapy has proved highly effective and led in one of these trials to a complete response in 75% of patients suffering from a blood cancer called CLL, which was resistant to chemotherapy. These are by far the most promising results seen in cancer treatment, which explains why so many companies are racing to achieve most advances in this field.

So far, only Kite and Juno have announced clinical data from trials using the CAR T-cells, with Cellectis to enter the clinical stage in 2015, and while most of these trials were using CAR T-cells of the 2nd generation, Juno is developing other generations (3rd and 4th) which may be more effective, especially in solid tumors, but will unlikely come without a safety cost.

However, it is noteworthy that most trials with CAR T-cells were conducted in patients with blood cancers affecting the B cells (mainly ALL and CLL), the reason is simply that B cells have a high specific molecule (CD19) that we can target without damaging other organs. Meanwhile, Juno, Kite and Bellicum are developing CAR T-cells to target other molecules (Juno: L1cam, Kite: EGFRvIII, Bellicum: PRAME) found in solid tumors. Nevertheless, achieving a high efficacy here is more challenging than what we have seen in blood cancers, mainly because L1cam and PRAME may be found in normal tissues while EGFRvIII is more tumor-specific but it is only found in 30% of patients with Glioblastoma (a brain cancer).

Safety profile is another challenge for CAR T-cells therapy, with many patients developing a life threatening reaction known as cytokine syndrome, in which the effective destruction of the tumor cells results in releasing excessive amounts of small molecules (the cytokines) causing symptoms similar to those seen in severe infections. Other deadly reactions may occur when targeting molecules existing in healthy tissues of the vital organs. However, Bellicum and Juno therapeutics are developing their own approaches to minimize this specificity related risk, either by providing their therapeutic cells with a suicide gene that can be triggered any time during the therapy to save patient’s life (Bellicum) or by making them able to recognize two different molecules and thereby increasing their tumor specificity and avoiding collateral damage.

After efficacy and safety, comes cost effectiveness as the next issue investors need to consider. This point becomes especially important once you know that most trials have used a patient’s own T-cells (autologous CAR T-cells), meaning that the developing companies will not be able to recognize their potential market size unless they make huge investments in building their advanced facilities in all demographic centers, which will make it very hard to keep a good profit margin. In this term, Ziopharm and Cellectis are developing a cheaper and more innovative solution, which may enable them to produce off-the-shelf CAR T-cells by genetically modifying these cells to prevent their immunoreaction against the patients’ healthy tissues. Increased affinity T cell receptors (TCR):Developing companies: Kite, Juno and Adaptimmune Therapeutics Plc (NASDAQ:ADAP).

This therapeutic approach is different from CAR T-cells by means of enhancing the receptors existing naturally on the T cells in order to break their cancer tolerance. The main advantage of TCRs over CAR T-cells is their ability to recognize extracellular and intracellular molecules as well, which will significantly increase the available therapeutic targets.

In clinical trials, increased affinity TCRs have demonstrated significant clinical responses in patients with metastatic melanoma, colorectal carcinoma, and synovial sarcoma, although the response rate was variable and ranged from 12 to 67%. Adaptimmune was the first company to announce data from clinical trials, where increased affinity TCRs were used to target a tumor specific protein molecule known as NY-ESO-1. These trials have shown a clinical response in over 50% of patients with solid and hematologic tumors.

The main downside of this approach is the lack of success in developing off-the-shelf therapeutic cells, as these same receptors (TCRs) take a main part in triggering the immune reaction against the host cells, meaning that these T-cells must be taken from the patients’ own blood. Cancer vaccines Developing companies: Bellicum, Inovio Pharmaceuticals Inc (NASDAQ:INO), Oncothyreon Inc (NASDAQ:ONTY), Celldex Therapeutics Inc (NASDAQ:CLDX), NewLink Genetics Corporation (NASDAQ:NLNK) and Northwest Biotherapeutics Inc (NASDAQ:NWBO).

Unlike the vaccines we take to prevent diseases, cancer vaccines aim mostly to treat diagnosed cancers, yet they have a similar mechanism. These vaccines aim to break the cancer immune tolerance by processing and reintroducing the cancer cells or their contents in a way that stimulates a natural immune response.

Despite the high potential of the adaptive T-cell therapies (CAR T-cells and TCRs), the vaccine based immunotherapy is, in my opinion, a more attractive medium to long term investment. Here are the main points, on which I based my thought:

  • Many cancer vaccines are already in late clinical stages (Phase II and III) what makes them, at least in theory, closer to any possible market entrance.
  • Most vaccines are being developed as off-the-shelf therapies, which means less operating expenses and a chance for higher profit margins comparing with the personalized CAR- and TCR- therapies.
  • Cancer vaccines have shown potency in many types of cancers, whereas the clinical efficacy of the CAR T-cells is still restricted to blood cancers.
  • From clinical trials, vaccines were less likely to cause the serious side effects seen with CAR T-cells (cytokine syndrome and organ failure), which makes the latter more vulnerable to safety related disappointments.

As many biotechs have adapted substantially different approaches to develop cancer vaccines, I will try to summarize these main approaches and their possible upsides and downsides:

Bellicum is developing an approach based on genetically engineering patient’s dendritic cells (the antigen presenting cells) so they can introduce a protein called PSMA (prostate-specific membrane antigen) to the other contents of the immune system in order to treat prostate cancer. Efficacy is still to be proven in clinical trials, but even then, finding specific targets, production complicity and cost effectiveness may be challenging for this approach.

Inovio’s vaccines utilize DNA structures that encode cancer specific proteins. Phase I trials have been initiated to test two vaccination products in a variety of cancers. Beside their suitability for universal (off-the-shelf) commercialization, the main advantage of this approach is its designing flexibility, meaning that one vaccine can be easily engineered to target more than one cancer protein.

Oncothyreon is developing off-the-shelf protein based vaccine to stimulate an immune response against a cancer specific molecule known as MUC1. This vaccine is being tested in phase I trials in patients with solid tumors.

Celldex is also working on two off-the-shelf cancer vaccines; the first is a Phase-III peptide that targets EGFRvIII (a cancer specific protein). In Phase-II trials, this vaccine has increased the 3-years survival rate in patients with Glioblastoma (a brain cancer) to 26% comparing with 18% under current standard therapy. The second vaccine uses a more sophisticated approach to deliver the immune stimulating protein directly to the dendritic cells and is being tested in phase-II trials with encouraging data from phase-I in multiple tumors.

Newlink took a totally different approach by modifying cancer cells themselves so they can be used as an off-the-shelf therapy to stimulate the immune response in patients suffering from the same type of cancer. Among the many trials, the best outcomes were seen in phase-II trials in patients with Pancreatic cancer, where this cellular vaccine achieved a 120% increase in 3-years survival rate. Despite the concerns associated with the injection of whole cancer cells, this vaccine has a good safety profile with no reported life threatening reactions.

Northwest Biotherapeutics is working on highly personalized cancer vaccines, which require obtaining the patient’s own dendritic and tumor cells as well. Apart from the financial challenges surrounding it, this approach has shown by far the best results seen in patients with glioblastoma (a brain cancer), as the patients had a median survival of 3 years (more than triple the usual time with standard of care treatments).

Checkpoints inhibitors

Checkpoints inhibitors are antibodies or small molecules that block specific receptors (known as checkpoint receptors) which help tumor cells escape the body natural immune attack. With proved clinical efficacies and favorable safety profiles, three checkpoints inhibitors were approved from FDA in the last four years (Opdivo ® and Yervoy ® from Bristol-Myers Squibb Company (NYSE:BMY) and Keytruda ® from Merck (NYSE:MRK)). Although their clinical benefits are less exciting than these seen in the above mentioned approaches, checkpoints inhibitors have a high potential to be used in combination with other immunotherapies, which may make them an essential ingredient in our future cancer recipe.

However, even when it may be a win-win game, investing in checkpoints inhibitors is not that simple as this approach is still dominated by the giant pharmaceutical companies, with only a few biotechs (including Agenus, Tesaro and Newlink genetics) developing similar agents in preclinical stages.

The bottom line

Even if we still can’t talk about a cancer cure, there is no doubt that the cancer immunotherapy will change the way we look at this disease in the next decade. Financially, and with the increasing numbers of biotechs engaged in this field, the best what investors can do is to understand what these companies are working on, follow the companies they are most convinced about and most importantly, use the harmless bad news to accumulate shares at lower prices

Latest comments

Thanks Tarek. Great article 👍
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