Slowly, TG investors start to fear the worst

The company’s stock slides 12% on fears that the goalposts in its all-important Unity-CLL trial are being moved.

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What is the definition of summer? Strictly speaking it is a season starting at the June solstice and ending on the autumnal equinox, and if you assume this then TG Therapeutics has five more days in which to report remission data from its Unity-CLL trial.

The end date is crucial, since TG’s most recent pronouncement, in August, was that Unity-CLL would read out not in the second quarter but “before the end of the summer”. Some have inferred from the ensuing silence a worst-case scenario, that negative results are already in house and being curated to find ostensibly good subgroup data to report as the clock ticks down.

This would not be the first change of tack at the heavily shorted company, whose development plan for ublituximab, an anti-CD20 MAb for chronic lymphocytic leukaemia (CLL), has been a moving target.

The spotlight had fallen on Unity-CLL after the design of Genuine, a trial of ublituximab on top of Imbruvica in high-risk CLL, was torn up, with TG abandoning a survival endpoint and thus nullifying a US special protocol assessment.

Unity-CLL combines ublituximab with TG’s in-house PI3K-delta inhibitor umbralisib, and pits this against Roche’s Gazyva and the chemo chlorambucil.

The change in the Genuine trial, TG said, was done in the interest of speed, and when that study read out positively for ORR the group pencilled in a mid-2018 filing (TG reverses October slide but questions remain unanswered, March 7, 2017). However, this plan was then abandoned.

Thus TG directed investors to look at the anti-CD20/PI3K combo in Unity-CLL, and talked up prospects of demonstrating an ORR benefit. The latest plan has this secondary endpoint backing an accelerated approval filing, with the primary progression-free survival result, expected next year, supporting full approval.

Target fixed

TG has nailed its colours firmly to the mast, powering Unity-CLL to show a 15-point ORR benefit in favour of its combo. With one delay under TG’s belt, and a second now threatening, the growing risk is that Unity-CLL has either not shown a 15-point benefit with high statistical significance, or that it has but this is no longer deemed unequivocal.

After all, there is no guarantee that the FDA will accept a 15-point benefit on this surrogate endpoint. And there are confounding factors in the study, such as the fact that it enrolled first-line as well as relapsed/refractory CLL patients, some but not all of whom had the high-risk 17p genotype that drove the benefit seen in the Genuine trial against standalone Imbruvica.

Suntrust analysts, who see TG’s share price doubling on a positive hit, or conversely falling 50% on failure, have argued that the proportion of 17p deletion subjects in Unity-CLL is crucial, because it is these who are more likely to respond to TG’s combo than to Gazyva and chlorambucil.

Yesterday's 12% fall, followed by a 5% decline this morning, means that TG stock has lost almost 40% since mid-2015, but the group is still worth nearly $750m. Part of the valuation is down to ublituximab’s phase III trials in multiple sclerosis, though here TG would be taking on another Roche anti-CD20 powerhouse, Ocrevus.

If TG already has negative Unity-CLL data in house, how might it try to tease out a favourable result? One thing might be to look only at 17p deletion patients. Alternatively, the data might be cut by line of therapy, or yet another subgroup could be sought – such measures being exploratory and thus of dubious relevance.

Worst of all, TG could try to gloss over a failure to show an ORR benefit and simply ask the market to bank on what, in that event, would be an unlikely positive survival readout next year.

Investors might also ask themselves what it is that TG is trying to show. Neither Unity-CLL nor Genuine before it includes Roche’s soon-to-be genericised anti-CD20 Rituxan, or Roche/Abbvie's highly efficacious newcomer Venclexta; in Unity-CLL TG is trying to beat Gazyva, a Rituxan follow-on, by adding on top of CD20 inhibition an anti-PI3K, an underwhelming mechanism in CLL.

With so many red flags it is little wonder that investors are getting cold feet over what is, at the end of the day, a relatively short delay.

This story has been updated to correct the design of the Genuine trial.

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