Argenx's big bid to stay ahead

Argenx has earned its $21bn market cap by rarely disappointing investors. An approaching clinical readout on Vyvgart, the group's FcRn antagonist, represents a big test of that reputation, and some analysts reckon failure could wipe as much as 40% off the group’s valuation.

Partly this is because the results will be the first of three pivotal datasets to emerge this year on Vyvgart, and a setback could knock confidence in the drug's potential. FcRn antagonism is a nascent mechanism, but huge sales forecasts exist for the class. The rare disabling disease in which the crucial readout is due also represents one of the largest new commercial settings in Argenx’s sights, adding to the weight of expectations.

That disease is chronic inflammatory demyelinating polyneuropathy, a progressive condition involving nerve inflammation and myelin sheath destruction, causing weakness and sometimes paralysis. The standard of care is immunoglobulins, which have been shown to improve measures of disability and to reduce relapses.

Analysts reckon CIDP accounts for a quarter of the $15bn immunoglobulin market, which is dominated by CSL and Grifols. Argenx’s hopes here rest on the Adhere trial, testing the subcutaneous version of Vyvgart, which contains the active ingredient efgartigimod. Readout was recently pushed back a couple of months, to the second quarter.

CIDP is considered an autoimmune disease but its causes are not completely understood, and the extent of IgG autoantibody involvement is an open question. This is pertinent because efgartigimod’s mechanism involves the suppression of IgG autoantibodies.

CIDP also has multiple subtypes, to the extent that some believe it might be a spectrum of conditions. Throw in the failure of UCB’s similarly acting rozanolixizumab in CIDP – like efgartigimod this MAb also blocks FcRn – and the risk of trial failure, or at least disappointment, is real.

Despite these red flags Argenx supporters reckon a win here is likely, largely thanks to smart trial design.

Firstly, Adhere used a 12-week run-in to identify patients with active disease, something that UCB failed to do, according to Stifel analysts. Those with confirmed active disease moved into the open-label Stage A, during which all patients received subcutaneous efgartigimod. The primary outcome measure for this initial stage was percentage of patients with clinical improvement at 12 weeks.

Before fully committing to the study Argenx ran an interim analysis on the first 30 patients in Stage A. This met the threshold for continuation in February 2021, based on “precedent clinical trials of current standard of care”. Analysts think this likely refers to the 54% response rate seen in Grifols' ICE trial, which helped established intravenous immunoglobulin in CIDP.

Hopes are high for a better response rate from efgartigimod. At the time of the go/no decision, Argenx’s chief executive, Tim Van Hauwermeiren, said the company was “comfortably in the go zone” at the interim analysis.

The delta

Next, to help select for patients with IgG autoantibody-driven disease, only those deemed responders in Stage A were eligible to progress to Stage B. This final segment was placebo-controlled and used time to first relapse as its primary endpoint, as measured by a disability score called INCAT; analysis will be triggered by the first 88 events. Immunoglobulins again provide the bar to beat, and have improved relapse rates by 24-37% over placebo.

As such, to look at least as good as immunoglobulins the delta between active and placebo needs to approach 40%. Stifel wants to see at least 50% to trigger its “bull case”.

As long as the result is statistically significant Argenx will be able to make a convenience argument here; subcutaneous efgartigimod takes around 30 seconds to administer, considerably quicker than subcutaneous immunoglobulins and in a different league to intravenous versions. But to grab share in an established market efgartigimod needs to offer clearly differentiated efficacy. 

Next up

Sellside analysts reckon CIDP could be worth $1-3bn in peak sales. This is not as big as generalised myasthenia gravis, in which the intravenous Vyvgart is already approved, and in which sales have consistently beaten expectations. CIDP is potentially larger than pemphigus and immune thrombocytopenia, settings in which phase 3 data are also due later in 2023.

These last two settings are arguably safer bets in that IgG autoantibodies play a much clearer role in them than in CIDP; plus, the first pivotal ITP trial has already read out positively. Concerning the intravenous Vyvgart, this was presented at Ash last year, and a second study using the subcutaneous formulation is awaited.

Winning regulatory approval for that subcutaneous product is also considered crucial for Argenx this year. As well as potentially opening the door to a premium-priced brand, this would keep the group ahead of FcRn rivals, which are also working on this more convenient administration. Earlier this year the FDA delayed its decision on that subcutaneous product by three months. Argenx did not disclose any reasons, although questions about side effects were raised when data were initially released.

Investors and the sellside brushed off the delay, despite this potentially being a waste of the priority review voucher the company deployed to speed up the decision. It recently bought a second PRV that is likely to be used on the CIDP application. The FcRN space is hotting up, and Argenx needs to keep its lead.