Seattle Genetics brushes off lintuzumab trial and focuses on brentuximab vedotin

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Seattle Genetics’ decision to terminate its clinical programme for lintuzumab (SGN-33) was a mild negative for the firm. Shares fell 4% to $12.20 Monday after the company announced lintuzumab had failed to extend survival in a phase II trial of elderly patients with acute myeloid leukaemia (AML), reflecting investors’ views that the monoclonal antibody might not succeed and that brentuximab vedotin is the more valuable part of Seattle's pipeline.

Seattle executives chose to take the lintuzumab data in stride, emphasising two upcoming readouts for brentuximab in lymphoma and inking a deal today allowing Genmab to use Seattle’s antibody drug conjugate (ADC) technology for compounds targeting tissue factor antigen in solid tumours. Still, the loss of a drug potentially valued at 12% of the company’s market capitalisation is certainly a blow.

Difficult disease, difficult patients

The phase IIb trial of lintuzumab, an anti-CD33 monoclonal antibody, in combination with low-dose cytarabine failed to show a statistically significant improvement in overall survival when compared with cytarabine plus placebo in AML patients 60 years and older. AML is a difficult disease to treat, as recent failures have shown, and even more challenging in a very sick elderly population unable to tolerate intensive chemotherapy.

Analysts regarded lintuzumab as high risk, given the lack of dose response, its failure at a lower dose in combination with chemotherapy in a previous phase III study sponsored by PDL BioPharma, a small sample of 210 patients, and the recent market withdrawal of Mylotarg which, like lintuzumab, targets the CD33 antigen. Consensus forecasts for lintuzumab have shrunk 63% in the past year, from estimates a year ago of $142m in worldwide sales by 2014 to $84m today, according to EvaluatePharmaarchive forecasts, indicating growing scepticism in the molecule.

Pivotal data

Given low expectations for lintuzumab, some bullish analysts even stretched the point somewhat by claiming the announcement of its cessation gets bad news out of the way before the company publishes topline data on brentixumab vedotin, also known as SGN-35, already licensed to Takeda outside of North America.

Indeed, chief executive Clay Siegall made an unambiguous announcement in a conference call with investors that the company in the next six weeks will release pivotal brentuximab vedotin data in relapsed/refractory Hodgkin's lymphoma, followed by phase II data in anaplastic large cell lymphoma. Mr Siegall said he expects a regulatory filing to follow in the first half of 2011.

Because of robust phase I/II results so far, investor expectations are much higher for that candidate, part of Seattle's ADC pipeline. Brentuximab vedotin has a net present value of $874m to Seattle, or 72% of its market capitalisation of $1.22bn.

As such, a failure for brentuximab vedotin would be a massive blow to the company, although positive data may only yield a mild boost to company shares as its success is already factored into consensus forecasts and the stock price, according to analysts from Brean Murray Carret.

In lintuzumab, Seattle Genetics has had its misstep, for which investors gave it a slap on the wrist. Expect the praise, or the punishment, to be much greater with brentuximab vedotin.

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