It must be tough being Agenus. The company focuses on follow-on oncology checkpoints at a time when the shine has come off this approach, and its lead assets target PD-1 and CTLA-4, so have dozens of competitors. But with the market off 20% in three months biotechs are more affordable, and some bigger groups are getting desperate.
This helps explain why Gilead yesterday gave Agenus a remarkable $150m up front for an undisclosed bispecific antibody plus options on two further assets. Clearly Gilead wants to act even before Roche’s outgoing pharma head, Daniel O’Day, becomes its chief executive in January, but Agenus seems a strange choice.
After all, Agenus has had a distinctly unremarkable existence since being founded in 1994 by Garo Armen, who is still at its helm. In the intervening 24 years it has turned $1.1bn of shareholder cash into a $300m market cap, and even that includes yesterday’s 23% share price uplift.
Gilead is not the first big group to sign on the dotted line; Merck & Co previously licensed several undisclosed Agenus assets, while a major alliance with Incyte focuses on the checkpoint antigens Gitr, Ox40, Lag-3 and Tim-3.
But it is a measure of how tough things have become that Agenus was recently forced to mortgage those two future royalty streams for $15m of ready cash. At the end of September the company had $46m in cash plus $13m of gross debt.
|Agenus's checkpoint MAb pipeline|
|AGEN2034||PD-1||No||Phase I/II; US filing 2019|
|AGEN1884||CTLA-4||No||Phase I/II; US (AGEN2034 combo) filing 2020|
|AGEN1223||Undisclosed||Gilead option||Bispecific for Treg depletion; IND filed|
|AGEN1423||Undisclosed||Gilead||Bispecific for TME conditioning; IND 2018|
|AGEN2373||CD137 (4-1BB)||Gilead option||IND 2019|
|INCAGN2390||Tim-3||Incyte||Meant to enter clinic 2018|
|Source: Agenus presentations.|
The $150m from Gilead, $30m of which is in the form of a premium-priced equity purchase, will thus come in handy. Agenus said the funds would help speed the development and launch of its leading PD-1 and CTLA-4 targeting projects for cervical cancer, a use not pursued by current incumbents from the likes of Merck, Bristol-Myers Squibb, Roche and Astrazeneca.
Gilead has struggled to make a mark on oncology after its hugely successful foray into hepatitis C. It did spend $11.9bn last year to buy the CAR-T player Kite Pharma but, with no in-house cell therapy expertise, the departures of many key Kite employees and the fact that CAR-T is a long way off being profitable, the jury is still out on the wisdom of this move.
Agenus gives Gilead rights to AGEN1423, a bispecific MAb targeting two undisclosed pathways involved in conditioning the tumour microenvironment, which is normally hostile to immunotherapy. Of the two assets under option AGEN1223 targets another means of resistance – T regulatory cells – while AGEN2373 hits CD137 (4-1BB), the same target as Pfizer’s phase II asset utomilumab.
However, Agenus will need more than the $150m fee from Gilead if it hopes to make any kind of impact on a PD-(L)1/CTLA-4 market already controlled by the biggest beasts in immuno-oncology.