Cancer Immunotherapy to Take Center Stage at ASCO

In early April 2010, we published a 150-page industry report titled “Cancer Vaccine Therapies: Failures and Future Opportunities,” which included an overview of the cancer immunotherapy market, interviews with several key opinion leaders, profiles of nearly 40 companies, and a discussion of the scientific, clinical, and commercial considerations for the major industry participants.   An executive summary of the report can be found by clicking here.

Some of the key messages from the report include the following:

  • Reminiscent of monoclonal antibodies in the late 1990’s, the field of active immunotherapy is poised for dramatic growth in the coming years
  • Nearly 50 clinical programs involving active immunotherapies for the treatment of cancer are currently underway, including nearly a dozen that are in pivotal Phase III development with several biologic license application [BLA] submissions planned in 2010
  • Using the history of passive immunotherapy [monoclonal antibodies] as a guide, we expect five active cancer immunotherapies approved within the next five years that will revolutionize the treatment of cancer
  • Beyond Dendreon Corporation’s (DNDN) Provenge®, there are a number of additional catalysts in 2010 that could ignite further interest in the field of cancer immunotherapy

A list of potential catalysts for cancer vaccine companies in 2010 was included in our initial report, such as the presentation of new clinical data during the American Society for Clinical Oncology [ASCO] annual meeting being held June 4-8, 2010. However, following a review of the abstracts published online, we identified three additional vaccine companies worth watching at ASCO.

Interestingly, the three companies span the largest segments of cancer vaccine development – allogeneic peptides [17 programs in development], gene transfer [15 programs in development], and autologous dendritic cell approaches [9 programs in development]. The first two approaches represent “off the shelf” cancer vaccines, while the latter is a “personalized” approach. To date, the only active immunotherapy approved for the treatment of cancer in the US is Dendreon’s Provenge, which is an autologous approach.

Bavarian Nordic A/S (BAVA.CO)

Bavarian Nordic, who’s stock price reached a multi-year high following approval of Dendreon’s Provenge, is developing Prostvac™ [also known as PSA-TRICOM], under a license from the National Cancer Institute [NCI]. Prostvac is a vector-based vaccine that targets prostate-specific antigen [PSA] and includes the transgenes for three human costimulatory molecules to enhance T-cell activation.  Following the recent publication of encouraging Phase II results and receipt of Fast Track designation from the FDA, Bavarian Nordic is planning to initiate a pivotal Phase III prostate cancer trial in 2010.

At ASCO, Bavarian Nordic is scheduled to present “Overall survival [OS] analysis of a phase l trial of a vector-based vaccine [PSA-TRICOM] and ipilimumab [Ipi] in the treatment of metastatic castration-resistant prostate cancer [mCRPC]” during the Developmental Therapeutics – Clinical Pharmacology and Immunotherapy General Poster Session held Monday, June 7, 8:00am to 12:00pm in S Hall A2. Separately, the company announced an investor and analyst briefing to be held in conjunction with ASCO on Saturday, June 5, 2010, in Chicago, IL.

Generex Biotechnology Corporation (GNBT)

While Canada’s Generex is perhaps better known for its $250 million lawsuit against and senior columnist Adam Feuerstein regarding two articles expressing doubts about the company’s oral insulin spray for the treatment of diabetes, its wholly owned subsidiary [Antigen Express, Inc.] is scheduled to present “Effect of a novel II-key hybrid HER2/neu peptide (AE37) vaccine with GM-CSF as compared to GM-CSF alone on levels of regulatory T-cell (Treg) populations” during the Developmental Therapeutics – Clinical Pharmacology and Immunotherapy General Poster Session held Monday June 7, 8:00am to 12:00pm in S Hall A2.

HER-2 is a growth factor receptor that is over-expressed by approximately 20-30% of patients with localized breast cancer and is the target for Herceptin® [trastuzumab] by the Roche Group (RHHBY). However, Generex isn’t the only company targeting HER-2/neu for the treatment of breast cancer. Other cancer vaccine developers working with the target include Dendreon, Bavarian Nordic, Apthera, Inc., and others.

Prima Biomed Ltd. (PRR.AX)

Similar to the concept behind Dendreon’s Provenge, Prima Biomed is developing an autologous dendritic cell vaccine for the treatment of cancer. The company’s lead product candidate is called CVac™, which incorporates the MUC-1 antigen that is overexpressed in cancer, including epithelial ovarian carcinoma. According to the company, prior phase I and II studies conducted in Australia in heavily pretreated, advanced disease patients showed minimal toxicities and prolonged disease stabilization.

Prima Biomed is scheduled to present “A randomized, open-label phase IIb study of maintenance therapy with a MUC-1 dendritic cell vaccine in patients with epithelial ovarian cancer in first or second remission” during the Trials in Progress Poster Session held Monday, June 7, from 8:00am to 12:00pm in S Hall A2.

Consistent with ASCO’s policies, we won’t report on research information represented by the aforementioned abstracts until the information is publicly released in conjunction with the annual meeting. Suffice it to say that we believe active immunotherapy for the treatment of cancer will take center stage at this year’s meeting.

Biotech Stocks and the ASCO-effect

Investors are hoping that the spark that could reignite investor enthusiasm for biotech stocks is taking place right now. Approximately 30,000 participants are gathering from May 29-June 2, 2009, in Orlando, Florida, for the year’s largest cancer conference. Attendees of the 45th Annual Meeting of the American Society of Clinical Oncology (ASCO) will exchange ideas and hear about the latest breakthroughs in cancer therapeutics and diagnostics from over 4,000 scientific abstract presentations during the four day event.

It is no wonder that ASCO is closely watched by biotechnology industry observers. According to the Pharmaceutical Research and Manufacturers of America (PhRMA), there are 633 medicines and vaccines developed through biotechnology in human clinical trials – the majority of them (254) for the treatment of cancer. Even more impressive, all of these products are either in human clinical trials or under review by the Food and Drug Administration (FDA).

The need for new cancer treatments and diagnostics is compelling. This year alone, the American Cancer Society estimates nearly 1.5 million new cases of cancer will be diagnosed with more than 562,000 Americans expected to die from the disease. Not only is cancer the second leading cause of death in the US (exceeded only by heart disease), the economic impact is massive. University of Chicago economists Kevin Murphy and Robert Topel reported that a permanent one percent reduction in mortality from cancer alone has a present value to current and future generations of Americans of nearly $500 billion and that a cure would be worth about $50 trillion.

For biotechnology companies working in the field of cancer, double or triple-digit stock price increases from the end of April through the ASCO meeting (usually held in late May or early June) are not unprecedented. I first dubbed this the “ASCO-effect” in May 2000 while presenting a review of the top five performing stocks from companies issuing ASCO-related news from 1996 through 1999. Ironically, more than a decade has passed, but some of the same companies are once again benefiting from the ASCO-effect.

For example, Peregrine Pharmaceuticals, Inc. (PPHM), known as Techniclone Corporation at the time, saw its stock price nearly triple as a result of the ASCO-effect back in 1998. The stock, which was trading below $0.40 at the end of April 2009, recently traded as high as $1.13 on news that preliminary data from a Phase 2 clinical trial evaluating the company’s bavituximab in combination with docetaxel in advanced breast cancer patients would be the subject of an oral presentation at ASCO.

In addition, the stock of Poniard Pharmaceuticals (PARD), known as NeoRx Corporation at the time, nearly doubled as a result of the ASCO-effect in 1998. The stock, which was trading around $3.00 at the end of April 2009, recently traded as high as $5.19 on news that data from two Phase 2 clinical trials evaluating the company’s picoplatin in metastatic prostate and colorectal cancer would be presented at ASCO.

Since there are over 4,000 scientific abstracts being presented during ASCO 2009, it would be impossible to detail all of them in this setting. However, following recent positive Phase 3 results from Dendreon Corporation (DNDN) regarding its prostate cancer vaccine study; it is not surprising that investors appear to be gravitating towards companies working in the field of prostate cancer treatment. This enthusiasm only increased when Johnson & Johnson (JNJ) announced that it would acquire Cougar Biotechnology, Inc. (CGRB), a development stage company with an oral prostate cancer treatment being studied in two Phase 3 clinical trials, for approximately $1.0 billion.

With this in mind, OncoGenex Pharmaceuticals, Inc. (OGXI) appears to be one of the early beneficiaries of the ASCO-effect in 2009. The company’s stock, which was trading around $6.00 at the end of April 2009, recently traded as high as $22.00 on news that the company will be presenting final results of a Phase 2 trial of its prostate cancer treatment at ASCO. On Monday, investors will react to the data presented over the weekend.

At the start of the year I provided a positive outlook for the biotechnology industry in 2009, citing the sector’s defensive characteristics, favorable technical aspects, and improving fundamentals, such as the number of new product approvals, products in clinical trials and the brisk pace of industry consolidation and licensing transactions. With these fundamental and technical characteristics intact, it is possible that this year’s ASCO meeting could be the spark that reignites investor enthusiasm for the sector.

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Disclaimer: This article contains the author’s own opinions, and none of the information contained therein constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. To the extent any of the information contained in the article may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person.