Medigene has now reaped both the rewards and risks of spending a couple of years repositioning itself as an immuno-oncology player. After a tripling over the course of the first 12 weeks of the year, its shares tumbled by a third yesterday as investor concerns about valuations mounted broadly in the biotech sector.
Nevertheless, it appears a savvy move to migrate into a space that has earned investors’ favour over the past year while licensing out legacy products like RhuDex and EndoTag, especially as other players in immuno-oncology like Kite Pharma and Lion Biotechnologies have rocketed through price targets.
“We had about 300 investor calls and meetings during the course of last year explaining the story, what had changed, what is new, what Medigene has transformed into,” finance chief Peter Llewellyn-Davies tells EP Vantage. “After a successful capital increase last year, we have a few new interesting investors on board in the US and UK.”
The buyout of a university spinout, Trianta Immunotherapies, last year brought Medigene three separate approaches to modulating the immune system to fight cancer (Medigene’s long hunting trip pulls down an immunotherapy company, January 27, 2014).
The most advanced of these is a dendritic cell vaccine that has already been in investigator-initiated trials in Oslo and Munich, in prostate cancer and acute myeloid leukaemia (AML) respectively, as well as in a compassionate-use programme in Oslo.
On Tuesday, Medigene said it had begun its own phase I/II AML trial. This vaccine approach, pioneered by Dendreon, uses the dendritic cells to present antigens specific to tumours to stimulate a T-cell or natural killer cell response.
Dendreon’s first-generation vaccine stimulated suboptimal T-cell responses because of its use of immature or partially matured cells; Medigene’s vaccine is considered a third-generation agent, with a quicker maturation time and antigen loading to provoke a stronger T-cell reaction.
Medigene’s AML trial will assess the project's ability to reduce the risk of relapse in 20 patients with minimal residual disease after completion of chemotherapy. The study will take place at Oslo University Hospital, also the site of the investigator-initiated AML trial.
“That gives us time to use a vaccine approach to raise a T-cell response and try to detect and eliminate those final tumour cells and protect the patients from a subsequent relapse,” says Dolores Schendel, Medigene’s chief science officer and Trianta’s co-founder. “Normally patients in AML go on to bone marrow transplantation. AML hits a lot of elderly people and they can’t undergo that.”
It will be blood
One cannot help but notice that the University of Munich’s trial is in prostate cancer, an indication in which Dendreon struggled to make headway with its Provenge (Lessons from Dendreon’s slow-motion car crash, November 10, 2014). Dr Schendel says, however, that the Medigene vaccine is being used in a different set of patients than Provenge – in this case, patients with low tumour load following surgical removal of diseased tissue, rather than advanced patients.
But with limited resources, the company intends to keep its own focus on the haematological cancers. This is also true of its second technology, receptor modified T cells, which resembles the chimeric antigen receptor T-cell (CAR-T) approach in that it involves use of patients’ own immune cells to battle cancer.
“Our technologies open the door to multiple collaborations around applications and use of these cells in solid tumours,” Dr Schendel added.
The third technology, T cell-specific monoclonal antibodies, is still early in preclinical development, but autoimmune disorders and T-cell leukaemia are thought to be potential targets.
The need for greater resources to fund its growing clinical pipeline will be an issue that Medigene will need to confront this year. With €15m ($16.4m) in the bank at year end, and an immunotherapy R&D budget that will grow from €2.9m in 2014 to as much as €9m in 2015, the group estimates that it has a cash runway into mid-2016.
The need for cash means a new fundraising or partnering will be in its near-term future, Mr Llewellyn-Davies says. This announcement was revealed in Medigene's year-end results yesterday, which likely contributed to its 33% tumble yesterday and 12% decline today.
Medigene will need to hope that the current biotech wobble stabilises before it raises money by selling shares, if that is its choice. Thus it has learned that surfing the immuno-oncology wave requires it to ride out some choppy waters. It needs to avoid a wipeout.