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Can one plus two equal three?
The launch of a new class of drugs called PD-1 inhibitors is revolutionizing how oncologists treat solid-tumor cancers. These drugs, including
Bristol-Myers Squibb's Opdivo, block the expression of a protein that cancer cells use to evade the immune system. PD-1 drugs have had so much success treating cancer that their sales total in the billions of dollars per year.
However, as good as PD-1 drugs are, they don't work for everyone, and that means there's an opportunity to create combination drug therapies that improve their efficacy.
One drug that could be combined with PD-1 therapy is Jounce Therapeutics' JTX-2011, a monoclonal antibody that binds to and activates the inducible T-cell co-stimulator (ICOS) protein found on the surface of certain T-cells. By activating ICOS, JTX-2011 may stimulate an immune response that makes PD-1 inhibitors more potent.
Jounce Therapeutics expects to unveil some data from an ongoing trial evaluating JTX-2011 plus Opdivo soon. It also has data coming from a trial evaluating JTX-2011 on its own. In total, these trials are evaluating JTX-2011 across six different solid tumor types, including non-small-cell lung cancer. The ability to treat multiple tumor types is particularly intriguing because it suggests that if JTX-2011's trials are positive, it could win widespread use.
shot at an acquisition, because Celgene already owns 2.8 million Jounce Therapeutics shares. " data-reactid="71">Jounce Therapeutics licensed JTX-2011 to Celgene in 2016, and if it ever makes it to market, Jounce and Celgene will split any profit on it 60/40. In addition to the profit split, Jounce is eligible to receive up to $2.3 billion in potential development and sales milestones as part of their collaboration. There's no telling how JTX-2011 data will read out, but if it's good, there's also a shot at an acquisition, because Celgene already owns 2.8 million Jounce Therapeutics shares.
Stud or dud?
TG Therapeutics is developing drugs that are more selective and potent in hopes of improving response rates in B-cell cancer and autoimmune disorders, including multiple sclerosis. This year, data from trials evaluating two of its drugs could lead to FDA approvals.
Its lead drug is TG-1101, or ublituximab, an anti-CD20 drug that's been designed to enhance antibody-dependent cell-mediated cytotoxicity better than prior-generation CD20 drugs, including the multibillion-dollar drug Rituxan.
reported that combining ublituximab with the top-selling chronic lymphocytic leukemia (CLL) drug, Imbruvica, resulted in an objective response rate (ORR) of 81% in CLL patients. That bests the 45% ORR for Imbruvica when it's used as a monotherapy. As a result, management thinks that if this study continues to produce positive data, it can file for approval as soon as Q3 2018." data-reactid="75">Recently, TG Therapeutics reported that combining ublituximab with the top-selling chronic lymphocytic leukemia (CLL) drug, Imbruvica, resulted in an objective response rate (ORR) of 81% in CLL patients. That bests the 45% ORR for Imbruvica when it's used as a monotherapy. As a result, management thinks that if this study continues to produce positive data, it can file for approval as soon as Q3 2018.
The company also has a phase 3 study wrapping up that's evaluating ublituximab in combination with another one of its drugs, umbralisib, in refractory CLL. The two-drug combination, dubbed "U2," is competing head-to-head against Gazyva and chlorambucil, a chemotherapy. If U2 outperforms the Gazyva arm, then TG Therapeutics hopes to ask for an accelerated approval by the end of 2018. Gazyva sales were approximately $73 million last quarter, at current exchange rates, so an approval could be profit-friendly.
TG Therapeutics also has two phase 3 studies planned for ublituximab in multiple sclerosis. On Friday, it reported updated phase 2 results showing sustained B-cell depletion through week 24, a complete elimination of T1 Gd-enhancing lesions, and no relapse in 97.5% of subjects at week 24. Because MS is a multibillion-dollar indication, ublituximab's opportunity in that indication is big, too.
Overall, no one knows how these trials will pan out for Summit Therapeutics, Jounce Therapeutics, and TG Therapeutics trials. They could fail miserably. If so, shares could crash. Nevertheless, risk-tolerant investors might want to consider them, because the upside opportunity if they succeed is substantial.
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Todd Campbell has no position in any of the stocks mentioned. His clients may have positions in the companies mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Source : https://finance.yahoo.com/news/3-boom-bust-biotech-stocks-130100644.html1619