FDA approves BIIB/Eisai’s Leqembi in early Alzheimer’s disease (AD)

The FDA has approved BIIB/Eisai’s Leqembi in early Alzheimer’s disease (AD).  Overall, we remain positive on BIIB’s opportunity to address the early AD market which is expected to be huge.   Wall Street estimates for worldwide Leqembi sales are as high as $15 billion.  Importantly, the recent Centers for Medicare & Medicaid Services (CMS) announcement that Medicare will provide broad coverage for Leqembi with participation in a registry upon full FDA approval means a fast rollout as Medicare covers millions of patients.  The full FDA approval is a monster win for both AD patients and BIIB/Easai.

Obesity Wars Heat Up As Lilly Starts Head-to-Head Trial Comparing Mounjaro to Wegovy

The obesity wars are heating up as Eli Lilly recently registered a Phase IIIb clinical trial, SURMOUNT-5, which compares Lilly’s Mounjaro with Novo’s Wegovy in obese or overweight patients with weight-related health conditions.  The head-to-head Phase III Trial will enroll 700 participants from 61 sites across the U.S., Canada, South America and several European countries. It began in April and Lilly expects its completion around January 2025.  The obesity market is huge and impacts 650 million people worldwide and nearly half of Americans. It is a chronic disease with limited treatment options that increases the risk of other weight-related conditions, such as diabetes and heart disease and affects overall health.

Huge Market:  The tremendous unmet need for weight loss has resulted in staggering sales projections.  Here is a smattering of the Wall Street’s best guesstimates; UBS projected that Mounjaro could reach peak sales of $25 billion, primarily in treating diabetes and obesity, TD Cowen analysts suggested that the global obesity drug market could reach $30 billion by 2030, with Novo and Lilly leading the charge. Morgan Stanley has the highest estimate at $50 billion.

Two Targets is Better Than One

Wegovy (semaglutide) stimulates the hormone glucagon-like peptide 1 (GLP-1) alone, while Mounjaro (tirzepatide) stimulates GLP-1 and glucose-dependent insulinotropic polypeptide (GIP). By targeting two receptors, Lilly’s drug stands to have a more significant effect. GIP and GLP-1 are hormones the gut produces in response to the nutrients in food.  GIP and GLP-1 have diverse roles in the body and are responsible for the incretin effect. In healthy humans, GIP is responsible for nearly two-thirds of the incretin effect, generating a more significant impact on insulin secretion than GLP-1. GIP is also responsible for regulating body weight through appetite and food intake.

The new way of thinking about obesity is how these medications affect the body’s metabolic set point, not the appetite.  Unlike metabolism, which can go up or down depending on diet, exercise and hormonal factors, the metabolic set rate remains fixed. Generally, this is why short-term diets fail—they don’t alter the set point. However, GLP-1 agonists can.  The belief is that drugs that lower the set point, natural hunger will come down as a secondary byproduct of the drug.  Lowering the metabolic set point also results in improvements in insulin resistance and how the body processes glucose.

VKTX-2735 Has Best in Class Potential

The recent Phase I data for ‘2735 was very good with promising tolerability with no discontinuations and low vomiting at the high dose.  In our view, the excellent safety profile combined with very good weight loss mean that ‘2735 has best in class potential.  A Phase II trial is expected to start soon and the company plans to implement a 3-week titration period in this trial compared to a more commonly used 4-week titration given the encouraging tolerability profile. The study will include four dosing arms with 15mg max dose in 100-150 patients.  We also expect oral ‘2735 Phase I data by year-end.  KOLs have recently pointed out that oral drugs with favorable tolerability should have a big advantage over injectable obesity drugs.

ASCO Review:  NATELEE Provides Promise in Early Breast Cancer

The most important update at ASCO 2023 for early breast cancer patients came from the CDK4/6 inhibitor (CDK4/6i) class, Novartis’ Phase III NATALEE study with Kisqali (ribociclib) + ET for patients with early breast cancer.  The data showed that adding Kisqali to a hormonal therapy reduced patients’ risk for recurrence by 25% compared to those on the endocrine therapy alone. Kisqali is currently approved to treat advanced and metastatic breast cancer and Novartis intends to submit for approval by the end of 2023. The results from the NATALEE trial of Kisqali in adjuvant HR+/HER2- early breast cancer will likely be practice-changing.

TCRT recently presented updated data from the first three patients treated in its ongoing TCR-T Library Phase I/II trial at the 2023 ASCO.  The poster highlighted the early clinical and translational data on the first three patients with refractory solid tumors expressing KRAS or TP53 mutations who received Sleeping Beauty TCR-T cells at one of two dose levels, DL1 (0.9 x 1010 TCR-T cells) and DL2 (6.4 x 1010 TCR-T cells and 5.8 x 1010 TCR-T cells). Manufactured TCR-T cells exhibited greater than 90% TCR positivity, viability and purity, underscoring the ability of the Company’s non-viral, universal manufacturing process to create TCR-T cells in multiple indications with different TCRs.  Importantly, the TCR-T cells had a manageable safety profile and showed signs of efficacy in patients with mutant KRAS, EGFR and TP53-expressing solid tumors, including non-small cell lung (NSCLC), colorectal, endometrial, pancreatic, ovarian and bile duct cancers.

The data showed that in the overall best responses, Patient 1 (NSCLC) had a partial response with 6 month progression-free survival, Patient 2 (colorectal cancer) had stable disease and Patient 3 had progressive disease (pancreatic cancer). The 3 patients had cytokine release syndrome grades 2, 3 and 1, respectively, that were self-limiting or resolved with standard management and anti-IL-6 antibody (Patient 2). TCR-T cell persistence was observed in all patients at last follow-up (6 months for Patient 1). The trial may proceed to dose level 3 as long as safety continues to be manageable.

The arbitraitors have ruled in ALKS favor against their partner JNJ/Janssen and they have been awarded $194 million in back royalties. The courts ruled that Janssen may terminate the license agreements, but they certainly may not continue to sell Products (as defined in the license agreements) developed during the term of the license agreements without paying royalties pursuant to the terms of the respective agreements;

– Back royalties related to U.S. sales in 2022 of approximately $194 million (inclusive of interest through March 15, 2023) are due to Alkermes from Janssen under the two agreements;

– A separate Know-How Royalty (as defined in the applicable license agreement) term applies for each of INVEGA SUSTENNA^®, INVEGA TRINZA^® and INVEGA HAFYERA^®, as follows:

• The term for INVEGA SUSTENNA ends on  20, 2024;
• The term for INVEGA TRINZA ends in the second quarter of 2030 (but no later than May 2030when the applicable license agreement expires); and
• The term for INVEGA HAFYERA ends in May 2030(when the applicable license agreement expires); and

– Royalties for CABENUVA^® in the U.S. are owed until Dec. 31, 2036.

ESPR recently announced that it has submitted Supplemental New Drug Applications (sNDA) to the FDA for NEXLETOL and NEXLIZET in order to add the use of both NEXLETOL and NEXLIZET for cardiovascular risk reduction and also seeks to remove the statin limitation in the LDL-C indication.

The sNDA submissions are based on Cholesterol Lowering via Bempedoic acid, an ACL-Inhibiting Regimen (CLEAR) Outcomes trial which showed NEXLETOL demonstrated significant cardiovascular risk reduction across a range of primary and second endpoints, including a 27% risk reduction of non-fatal myocardial infarction, a 23% risk reduction of the composite of fatal and non-fatal myocardial infarction, a 19% risk reduction of coronary revascularization, a 15% risk reduction of the MACE-3 composite, and a 13% risk reduction of the MACE-4 composite.

Following the FDA’s review of the submission, it will notify the Company if the applications are deemed complete for review by mid-August 2023. The Company anticipates FDA approval of the sNDAs in the first half of 2024. These timeline are important as the significantly broader label that includes the CLEAR cardio outcomes benefit will allow payors to add the drugs to their formularies. The expanded label will also make the drugs much easier to sell which will dovetail perfectly with more insurers covering the drugs with expanded cardio outcomes benefit on the label.

IONS recently announced positive clinical progress with donidalorsen, its late-stage investigational prophylactic therapy for hereditary angioedema (HAE). Topline two-year open-label extension (OLE) results continue to demonstrate consistent efficacy and safety, with an overall sustained mean reduction in HAE attack rates of 96% from baseline through two years across dosing groups. The company also announced that it has completed enrollment in the Phase 3 OASIS-HAE study, which is evaluating the safety and efficacy of donidalorsen in preventing angioedema attacks. Topline data from the study are expected in the first half of 2024. HAE is a rare and potentially fatal genetic disease characterized by severe and potentially fatal swelling of the arms, legs, face and throat.

IONS announced the pricing of $500 million principal amount of 1.75% Convertible Senior Notes due 2028 (the “notes”) in a private placement (the “offering”) to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). Ionis also granted the initial purchasers of the notes an option to purchase, within the 13-day period beginning on, and including, the date on which the notes are first issued, up to an additional $75.0 million aggregate principal amount of notes from Ionis. The sale of the notes is expected to close on June 12, 2023, subject to customary closing conditions.

PGEN reported positive data at ASCO combining PRGN-2009 with checkpoint inhibition that demonstrated a favorable safety profile and resulted in a 30% ORR with prolonged duration of responses in patients with heavily pre-treated HPV-associated cancers, including those who were checkpoint blockade resistant.  The monotherapy arm only showed a modest effectiveness while the combo’s 30% ORR is a win for ‘2009.  The company announced on May 31 that they have started a Phase II trial combining PRGN-2009 with a checkpoint inhibitor to further investigate safety and efficacy in recurrent or metastatic cervical cancer.  The Phase II randomized, open-label, two-arm, multicenter trial will evaluate the efficacy and safety of PRGN-2009 in combination with pembrolizumab versus pembrolizumab monotherapy in patients with recurrent or metastatic cervical cancer who are pembrolizumab resistant. This new trial is the second Phase II for PRGN-2009 AdenoVerse, adding to the ongoing Phase II in oropharyngeal squamous cell carcinoma.

PGEN also had early data for PRGN-3005 at ASCO that showed it was well-tolerated with no dose limiting toxicities, no CRS greater than Grade 2, and no neurotoxicity.  ‘3005 demonstrated expansion and persistence when delivered via either intraperitoneal or intravenous infusion without lymphodepletion or via intravenous infusion after lymphodepletion demonstrating the effectiveness of mbIL15.

VXRT has announced that the last subject has completed dosing in the Phase II clinical trial of its oral pill bivalent norovirus vaccine candidate. In addition, all patients have been challenged in its challenge study of its G.1.1 monovalent vaccine candidate. No vaccine related SAEs have been reported to date in either trial, consistent with the safety profile observed in all our norovirus trials. The Company also expects to report topline data from the ongoing Phase II challenge study (NCT05212168) of Vaxart’s G1.1 monovalent norovirus vaccine candidate during Q3 2023.  In our view, the two Phase II norovirus trials have the potential to provide proof-of-concept for the program and the oral vaccine platform.

The company continues to expect to report topline data from the ongoing Phase II dose-ranging study (NCT05626803) of its bivalent norovirus vaccine candidate in mid-2023. The primary endpoints are safety and immunogenicity, with the objective of determining dose levels for Phase III development.