Why This Major FDA Approval Could Pave the Way for These Five Biotechs
by Marc Lichtenfeld, Senior Analyst, Investment U
Wednesday, March 30, 2011
Last Friday, the FDA approved Bristol-Myers Squibb's (NYSE: BMY) Ipilimumab drug for metastatic melanoma.
While many other global stories dominated the newswires, this was also a big deal, as there's no effective drug for the disease. But Bristol-Myers' results show that when taking Ipilimumab, patients survived an average of four months longer. Some have even lived as long as two years or more - a significant development, given that metastatic melanoma is such an aggressive and deadly disease.
But on the back of this news, the big picture for biotech companies is even more exciting...
These Two Successful Cancer Treatments Could Bode Well for Others
Following the Food & Drug Administration's approval of Dendreon's (Nasdaq: DNDN) Provenge prostate cancer drug last year, Ipilimumab is the second cancer immunotherapy drug to get the green light from the FDA.
These two drugs work differently than traditional chemotherapy treatment for cancer. Chemo basically poisons the body, including the cancer cells, which is why the side-effects can be so severe.
On the other hand, immunotherapeutic drugs use the immune system to kill the cancer. In Ipilimumab's case, it blocks a molecule that stops the immune system from attacking the cancer. The drug "takes the foot off the brake of the immune system," according to Bristol-Myers.
But Bristol-Myers and Dendreon aren't the only companies researching cancer immunotherapeutic drugs - far from it. There are many other publicly traded biotech firms, plus private companies and universities, that are active in the field. At least 50 cancer immunotherapy drugs are currently in clinical trials. And the FDA's approval of Ipilimumab could clear a path for more drug success in the near future.
Can These Five Companies Replicate Dendreon and Bristol-Myers' Success?
Let's take a look at a few of the most promising public companies...
- Celldex Therapeutics (Nasdaq: CLDX): Celldex's Rindopepimut tackles brain cancer and its Phase II clinical trial results were outstanding. Overall survival increased to 26 months versus 15 months for patients on Temodar, the current standard of care. Temodar generates roughly $1 billion per year in revenue from brain cancer. Celldex is expected to begin Phase III trials later this year.
- Geron (Nasdaq: GERN): Using its cell technology, Geron is developing GRNVAC1 for treatment of acute myelogenous leukemia (AML). In a Phase II trial, 13 out of 21 patients were in complete remission, while 7 out of 11 patients who were considered at high risk for relapse remained in complete remission for up to 30 months.
- Micromet (Nasdaq: MITI): Blinatumomab is currently in a pivotal trial for acute lymphoblastic leukemia and Phase I for non-Hodgkin's lymphoma. Clinical trial data to date has been strong.
- Oncothyreon (Nasdaq: ONTY): Stimuvax is currently in Phase III studies for lung and breast cancers. In a Phase II lung cancer study, the median survival was extended to 30 months from 13 months.
- Vical (Nasdaq: VICL): Allovectin-7 is in Phase III trials for metastatic melanoma. It's designed to help the immune system recognize and destroy tumor cells. The Phase II results were better than Ipilimumab's Phase III, with median survival at 18.8 months versus 10.1 months. The side-effects were less severe, too.
However, the challenge for Vical will be to replicate the data in a larger Phase III. That may be difficult to do, as Phase III results usually aren't as strong as Phase II, even in drugs that are effective and get approved.
Over the coming decade, immunotherapy is likely to become one of the most significant developments in cancer treatment. And with more companies joining the fight against it, it bodes well for patients and investors alike.