Biotech General Discussion

Amp provides this deep dive into the following Q1 2020 spotlight catalyst, In order to assist subscribers in assessing this catalyst*:

Initial safety and efficacy data for the following Phase 1/2 trial:

A Study of a CD122-Biased Cytokine (NKTR-214) in Combination With Anti-PD-1 (Pembrolizumab) in Patients With Select Advanced or Metastatic Solid Tumors (PROPEL)

Timing (estimate) of readout: Early Q1 2020 (on day of NTKR's JP Morgan presentation?)

What is success for NKTR in trial:

From NKTR's comments, success will be a marked improvement over these historical overall response rates in NSCLC by PD-L1 tumor expression status (See KEYNOTE-001 results and NKTR comments in deeper dive below):

PD-L1 status: HIstorical pembro montherapy data

<1% (negative): 5% to 10% ORR (See KEYNOTE-001 below)

1-49% (low/intermediate): 15% to 20% ORR (KEYNOTE-042)

50% and above (highly positive): 40% to 50% ORR (KEYNOTE-024 and KEYNOTE-042)

Bear case:

With data from only around 30 patients split across 3 different PD-L1 expression levels, there will be too little data to clearly show a benefit of Bempeg (#NKTR-214) + Keytruda in this patient population. This is especially true since the trial, like most early stage anti-PD1 combo trials, does not have a Keytroda alone control group. Thus, the data will need to be compared to historical data from other trials, including a Phase 1 Keytruda trial (KEYNOTE-001) published over 5 years ago, and unless the ORR percentages are dramatically higher than the above KEYTRUDA targets, the market will not be convinced that Bempeg is adding much to the combo. Plus, BMS opted out of this indication for the combination of Nivo, its anti-PD1, with Bempeg after analyzing data from NSCLC patients in the prior PIVOT-2 trial (1). Finally, NKTR has numerous assets and has already reported some early data in NSCLC and other solid tumors in the PIVOT-2 trial and thus additional early stage data for a small number of patients will not move the stock much on this $3B market cap company.

Bull case:

Even with small numbers, a substantial increase over 10% should be observed in the PD-L1 negative tumors because Bempeg appears to induce PD-L1 expression in tumors (3), which should render these tumors susceptible to Keytruda (Pembro). Bempeg in combination with Nivo, another anti-PD1 therapy, showed a 60% response rate in 5 patients with NSCLC, and 1 out of 3 with PD-L1 negative tumors (1) and that was with NIVO, which may not be as effective and Keytruda (Pembro) in NSCLC. It is perplexing that BMS did not want to sponsor the NSCLC trial since 2 of 2 PD-L1 positive NSCLC patients saw complete responses in the PIVOT-2 trial (1 (Figure S3)). Furthermore, we may see data from more than 30 patients since NKTR reported that they were ahead of their enrollment projections.

DEEPER DIVE INTO CANDIDATE DRUG AND TRIAL:

A Study of a CD122-Biased Cytokine (NKTR-214) in Combination With Anti-PD-1 (Pembrolizumab) in Patients With Select Advanced or Metastatic Solid Tumors (PROPEL)

Timing (estimate) of catalyst: Safety and initial efficacy data in NSCLC patients (focus of trial despite "solid tumors" in title) in early Q1 2020 (on day of NTKR's JP Morgan presentation?)

Clinical trial: https://clinicaltrials.gov/ct2/show/NCT03138889

• Re: timing see comments of NKTR CEO from Q2 2020 investor call:

"We expect to be on track to generate initial safety as well as preliminary ORR data for between 10 and 20 patients with a minimum of 2 scans on treatment from both the dose escalation and non-small cell lung cancer cohorts of the study by end of this year or first quarter ‘21."

• About the PROPEL Phase 1/2 Program: Bempegaldesleukin in combination with KEYTRUDA® (pembrolizumab)

The PROPEL study will evaluate the clinical benefit, safety and tolerability of combining bempegaldesleukin (BEMPEG) with pembrolizumab in approximately 100 patients and is comprised of two groups: dose optimization and dose expansion cohorts. The dose optimization cohort will evaluate BEMPEG in combination with pembrolizumab in approximately 40 patients with solid tumors. The dose expansion cohort will evaluate BEMPEG in combination with pembrolizumab in approximately 58 patients with first-line NSCLC.

From NKTR web site Pipeline section

• See comments below re: enrollment from Howard Robin - NKTR's CEO from the Q3 2020 investor call 11/5/2020

"We're also advancing our development of bempeg with the checkpoint inhibitor pembrolizumab in the PROPEL study in non-small cell lung cancer, which is one of the largest solid tumor opportunities for bempeg. We are well ahead of our enrollment projections for the PROPEL study, and I'll let Wei share more about this program -- more about the progress that we've made in the program in that study in a moment."

DRUG CANDIDATE HISTORY (IN THIS INDICATION):

PRESENTATIONS

• 12-2020: Winter Congress Virtual Booth - Bempeg - NSCLC poster

• 03-2020: Cowen 40th Annual Health Care Conference (slide 11, 27)

  • Trial design:

• 09-2020: ESMO 2019 poster re: PROPEL trial

• KEYTRUDA NSCLC Label data

PUBLICATIONS

1. 08-2020 Bempeg (NKTR-214) plus NIVO in solid tumors (PIVOT-2) (Cancer Discovery (2014) 10:8)

2. 2020: Bempegaldesleukin selectively depletes intratumoral Tregs and potentiates T cell-mediated cancer therapy. Nature communications, 11(1), 1-11.

3. 2019 Bempeg monotherapy in solid tumors - Cancer Discovery publication

4. 2015 Pembro in NSCLC NEJM Publication (KEYNOTE-001) (Pembro 200 mg every 3 weeks - same as Keytruda (pembro) label) (See slide S6 Pembro monotherapy in NSCLC below)

OTHER

BMS Partnership

See comment from CEO Howard Robin from Q2 2020 investor call:

"With respect to first-line non-small cell lung cancer, as you know, Nektar has been running the PROPEL study of bempeg plus pembro as a separate independent study from the BMS development program with the goal of moving forward with a registrational strategy in non-small cell lung cancer that combines bempeg with the existing and preferred standard of care, which is pembrolizumab. A development and regulatory pathway for bempeg plus nivo is very challenging given nivolumab’s lack of a single-agent label in first-line non-small cell lung cancer. BMS has recently informed us that they will not start the Phase 2 study in first-line non-small cell lung cancer with bempeg plus nivo that was outlined in our amended agreement, thus in line with this agreement, Nektar no longer has any exclusivity obligations related to advancing registrational or other trials in non-small cell lung cancer with BMS."

Accelerated Approval

• See comments below re: possibility of accelerated approval filing from Wei Lin - NKTR's SVP & Head of Development from the Q3 2020 investor call 11/5/202

lexandre Bouilloux

"This is Alex on for Difei. And apologies if this was addressed already, but quick question on non-small cell lung cancer and bempeg combo with pembro. Assuming you show positive data here in the upcoming readouts, what would be the strategy going forward? And would there be an opportunity to pursue kind of an accelerated pathway to approval?"

Jennifer Ruddock

"Thanks, Alex. Wei, I'll ask you to comment again briefly on that.

Sure. Yes. So I think -- I mean it's a great idea. It's certainly something that we would be willing to interest in for -- with the health authorities. Now the -- historically, in the first-line setting, there has not been an example of accelerated approval based on just a response rate, certainly not -- with exception of like a TKI such as [indiscernible] so now -- so the -- so it's something that we will have to explore with the health authorities, and it really depends on the robustness of the data we generate from PROPEL."

Mechanism of Action

Bempegaldesleukin is a CD122-preferential IL-2 pathway agonist designed to stimulate the patient's own immune system to fight cancer. Bempegaldesleukin is designed to grow specific cancer-killing T cells and natural killer (NK) cell populations in the body which fight cancer, which are known as endogenous tumor-infiltrating lymphocytes (TILs). Bempegaldesleukin stimulates these cancer-killing immune cells in the body by targeting CD122 specific receptors found on the surface of these immune cells, known as CD8+ effector T cells and NK cells. CD122, which is also known as the Interleukin-2 receptor beta subunit, is a key signaling receptor that is known to increase proliferation of these effector T cells (learn more).

Pembro is an anti-PD-1 antibody that is approved for patients with NSCLC having PD-L1 positive tumors (See Keytruda label).

COMPETITORS and MARKET

See BPIQ Card fort this trial (HERE)

SUCCESS OF PROPEL TRIAL

• See comments below re: success vs. pembro mono-therapy from Wei Lin - NKTR's SVP & Head of Development from the Q3 2020 investor call 11/5/202

George Farmer

"Wei, can you comment a bit on what the bar for success would be in PROPEL? 30 patients that are basically going to be distributed among different PD-L1 subgroups, are you expecting to see any differences there? And I know 30 patients is a good number to hit, but it's spread across all these different subgroups. It might get a little thin per subgroup."

Wei Lin

"Sure. Yes, I'll take the first part of the question. Yes. Thanks for that great question. So it's something we've thought a lot about because that the registrational goal decision is an important decision for development of any drug. For bempeg, in particular and for the PROPEL study, as you well know that the current standard of care really segments that population in the first-line metastatic non-small cell lung cancer population into 3 subgroups. And that's less than 1% of PD-L1 expression, 1% to 49% and 50% above. And then we have either early phase data or registrational data that we can use to benchmark against the historical numbers that pembrolizumab has in each of the subpopulations.

So first of all, looking at the population of less than 1%, pembrolizumab as a single agent-based on the early phase data really had a response rate of 7% to 8%. So really in the single-digit range in the 5% to 10% range, and that's what we expect. Right? So that's a benchmark for that population of patients.

For the 1% to 49%, the response rate is typically hovering around 17% or so from past trials, specifically KEYNOTE-042. And so we're really looking at a benchmark of pembrolizumab in that population patients of 1% to 49%, ranging about 15% to 20% response rate.

And then finally, the benchmark for the 50% above PD-L1 expression subgroup, looking at data from KEYNOTE-024 as well as 42, we're looking at the numbers that are really in the 40% to 50% range. So that's the baseline response rate for monotherapy pembrolizumab.

So I think to your point, because of these subgroups, we have -- when we do generate the 30-plus patient worth of data, we'd be looking at data by segmenting into each of these subgroups. And this would help us to really understand fully how our drug works and also help us to design our registrational study.

So I think what we -- now the registrational study for a doublet of pembro plus bempeg, pitting that against pembrolizumab monotherapy, will be limited to the 1%-above population because pembro mono is not approved in less than 1%. However, I think the less than 1% data generating from PROPEL will be extremely informative because I think IL-2 being known as a proinflammatory cytokine is expected to inflame the tumor. As we have shown in our early phase data from PIVOT-02 on treatment biopsies, for instance, in our bladder cancer trial, we were able to demonstrate that 7 out of 10 patients who previously was PD-L1 negative, meaning PD-L1 expression less than 1%, we're able to convert to PD-L1 positive after treatment, just 1 cycle treatment of bempeg.

And so the -- I think if this is where we really hope to be able to see similar phenomenon in non-small cell lung cancer in the PROPEL study. And hence, while the pembro monotherapy is approved in a broad spectrum of patients, I think probably the subgroup that would be most informative to us will be the less than 1% as well as the 1% to 48% -- 1% to 49% because, number one, those benchmarks are low; number two is those benchmarks are actually fairly low, such that if we demonstrate a cyclical improvement of, say, a doubling of the response rate, then we know that the bempeg as a molecule has really followed through its MOA as we have seen in other tumor types of inflaming the tumor especially in the PD-L1 low expressing or at the nonexpressing tumors to really engage and inflame the tumor, allowing that to be sensitive to a checkpoint inhibitor, such as pembrolizumab.

So we'd be definitely looking at the data in a very nuanced way, dissecting out each subgroups and interpreting them separately and looking for really robust signals that will allow us to have confidence that we have a combination of bempeg plus pembro that can significantly improve upon the benefit that pembrolizumab monotherapy is delivering to patients in first-line non-small cell lung cancer."

• See comments below re: success vs. pembro mono-therapy from Wei Lin - NKTR's SVP & Head of Development from the Q2 2020 investor call 8/7/202

Tyler Van Buren

Hey, good afternoon. Congrats on all the progress. I guess I have two questions. The first one is on PROPEL, the first-line non-small cell lung cancer trial, combo with pembro. We are going to get initial data potentially year end to early next year and you noted that we could get overall response rate data in 10, 20 patients greater than two scans. So I guess, can you just help us understand exactly what pembro monotherapy would show at that time point and therefore, what overall response rate with the combo you would like to see to really be confident in the combo moving forward?

Wei Lin

Okay. Sure, absolutely. Yes, thanks for the question. Yes, certainly, I think non-small cell lung cancer, even with the recent advancement, still remains a high unmet medical need. I think – so we’re building upon the standard-of-care pembro monotherapy. And as you know that non-small cell lung cancer really is segmented into 3 different populations based on PD-L1 status. You have the 50% and above PD-L1 expression and 1% to 49% and less than 1%. And there are different benchmarks. In the 50% and above and 1% to 49%, the response for a single agent is certainly different, and that’s also different than the less than 1% where pem mono is not actually approved. Because we have available these response datas of pembro monotherapy, we can evaluate what the additive value of potential synergy the bempeg in combination with pembrolizumab can bring. And so that is how we’re going to really evaluate the data. So with our PROPEL study design, so first of all, we have two parts of the study. There’s an optimization cohort and there’s a expansion cohort in non-small cell lung cancer. And to really address your question, I’ll focus on the expansion cohort in non-small cell lung cancer. And in there, we have actually subdivided the groups of patients into enrolling separately patients that are 50% and above, 1% to 49% and also less than 1% conforming with the current kind of the segmentation of use of either pembro monotherapy or pembro plus chemo in these segments and also knowing the different benchmarks. And so that is how we’re going to really look at the data. So we will enroll 20 patients roughly in each of these subgroups for a total of roughly 60 patients. And then based on the response we observe in the 50% and above, in the 1% to 49% and less 1% and benchmarking against pembro monotherapy, that’s how we will make an assessment whether there is additivity or synergy that we can potentially observe with the combination with pembrolizumab and bempeg and our future registration trial in first-line non-small cell lung cancer would entirely be based on what we observe in each of these subgroups and what population will be ideally enrolled into the future registration study. So yes, so that addresses how we are going to look at the data in regard to making a registration decision in non-small cell lung cancer.

#NKTR-214, Keytruda, #anti-PD1, #IL-2, #IL2, #NKTR214, #Bempeg, $NKTR

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