Small-Cap Adjuvants For Cancer Treatment
For investors, successful adjuvant therapies can offer tremendous upside potential as these may be utilized in a host of indications and offer the opportunity of being part of the standard of care regimen. Following are some small pharmas to consider that have clinical-stage candidates that are being developed in the adjuvant cancer therapy setting. The indications targeted are varied and offer a diversified investment approach for consideration. Highlighted are three promising cancer immunotherapy adjuvants currently in trials: QS-21 Stimulon, IL-12, and fully synthetic PET Lipid A.
The cancer front
Along the cancer front, QS-21 is being used by GlaxoSmithKline with its MAGE-A3 Cl immunotherapy drug in phase 3 trials for patients with resected melanoma and patients with non-small cell lung cancer, both with results due out in 2013. With licensing rights and royalties on the line, QS-21 has much hope resting on it. Success in the phase 3 trials for the cancer indications will be a huge catalyst for the company, nevertheless its future appears to be secure already in for the moment the malaria indication with over 800,000 people dying from the disease annually - a huge market potential.
Much will be revealed in 2012 for the company's ElectroImmunotherapy program with catalysts coming in the form of phase 2 interim data for metastatic melanoma, phase 2 interim data for Merkel cell carcinoma, and enrollment initiation for a phase 2 trial for the treatment of cutaneous T-cell lymphoma. The company is as well developing its ElectroChemotherapy program utilizing bleomycin as its chemotherapy agent. The central focus of that program is the head and neck cancer indication with two completed phase 3 trials pursuant to this agreement its belt, with data presented July 22-24 offering much hope for patients and much upside for investors.
Oncothyreon Inc. made headlines in October of 2011 via an announced collaboration with Merck Serono to develop and market oral multiple sclerosis candidate, ONO-4641, and co-develop and co-market cancer immunotherapy candidate, Stimuvax. The deal netted Oncothyreon an upfront payment of $19 million for ONO-4641 in which Merck Serono acquired worldwide rights excluding Japan, Korea, and Taiwan, with additional milestone payments pending. It as well netted Oncothyreon an upfront payment of $6 million for Stimuvax, during sharing upcoming development and marketing expenses.
Oncothyreon initiated a phase 1 trial on March 14th of this year investigating the safety and immunogenicity of ONT-10 in patients with cancers expressing MUC1 with a host of cancer types to be included: breast, NSCLC, ovarian, colorectal, prostate, pancreatic, gastric, and others. In the two-part trial, Oncothyreon will evaluate ONT-10's ability to cause both humoral and cellular immune response. Promising results in this early-stage however real-world trial could be a huge catalyst for the company, as not only would it have a drug with multiple indications targeted henceforth, yet it would have a novel adjuvant that it could chose to license out for additional revenue or to tempt Big Pharma suitors for additional partnerships or acquisition purposes.
The surface of adjuvant use in fighting cancer
This article is only intended to "scratch the surface" of adjuvant use in fighting cancer. There are many approaches to investing in these companies with successfully or potentially successful adjuvants. These companies may choose to develop these therapies through to regulatory approval if the candidates are proven effective and market the therapy combinations themselves or through partnerships. At that point, they may as well continue developing them in-house or may choose to license out the innovation to others as Oncothyreon has done with Stimuvax. Investors are advised to read company updates carefully as any late-stage trials show signs of success to ascertain what plans the companies have as regulatory approvals approach and how they intend to manufacture and market the successful therapies.
Each mentioned company has its strong points and risks. The market capitalizations for Agenus, OncoSec, and Oncothyreon are $103 million, $18 million, and $233 million, respectively. Investors must ascertain which values are appropriate with their current pipeline successes, long-term potential of their therapies, and company financial situations. The presented companies represent diverse candidates with none of the "eggs in one basket" mentality that often plagues these low market capitalization development-phase biotechs.
The smallest market capitalization of the three
OncoSec has the smallest market capitalization of the three and is as well the youngest of these three small pharma. Nevertheless, it does have a phase 3 trial in ElectroChemotherapy utilizing bleomycin as the agent of choice against head and neck cancer pursuant to this agreement its belt with solid data reported previously this week. The company as well has additional catalysts from other indications in trials already underway via two phase 2 trials in its ElectroImmunotherapy program expecting interim data in 4Q 2012, and another set to begin enrollment this year. With no large pharma partnerships announced as of but, and the likely poorest financial condition of the three, the company does have a $7.75 million offering from late March which resulted in a stock price drop giving new investors a good entry point if the company's trials continue proving successful. The offering's effectiveness was seen with $6.6 million in cash and equivalents on the whole being available on April 30th.
To better ascertain risks, investors should consider current cash conditions of each, cash burn rate, and upside/downside potential for success or failure in their current pipelines. Diversity of pipelines is evident in Agenus and Oncothyreon. But, the multiple indications targeted by OncoSec and the flexibility of the electroporation platforms should as well be considered. Currently, the ElectroImmunotherapy platform is based on IL-12 and the ElectroChemotherapy platform is based on bleomycin. All in all, these agents may be substituted for a host of others that, in the author's opinion, should be investigated for diversification purposes regardless of the degrees of success in the company's current trials.