Stanford’s New Cancer Immunotherapy Starting Clinical Trials Could Spur a Big Pharma Bid

Print Email

The concept behind cancer immunotherapy vaccines has been around since, believe it or not, 1891. This is when one Dr. William Coley began directly injecting tumors with bacteria, with 10% to 20% complete response rates. Since this was nearly 130 years ago, the medical community still isn’t exactly sure what happened here, but many believe that injecting bacteria into a tumor attracted immune cells to the bacteria in order to attack it, and while they were there, they attacked the tumor as well.

Now, 130 years later, Stanford University is using a similar concept to eradicate solid tumor cancers in mice with a phenomenal 97% complete response rate. A Phase 1 trial in humans is about to begin. Exciting yes, but what is the relevance for investors?

Simply this. Cancer immunotherapy approaches have attracted the attention of Big Pharma in the past, with deals in the billions of dollars. Stanford’s technology probably will be no exception if Phase 1 results are positive. If they are anywhere near as positive as preclinical results, expect a bid.

Here’s some perspective. Within the past decade, University of Pennsylvania has allied with Novartis A.G. (NYSE: NVS), Baylor College of Medicine with Bluebird Bio Inc. (NASDAQ: BLUE) and Celgene Corp. (NASDAQ: CELG), Memorial Sloan Kettering Cancer Center and the Fred Hutchinson Cancer Research Center with Juno Therapeutics Inc. (NASDAQ: JUNO) (which Celgene just got clearance to acquire), and the National Cancer Institute with Kite Pharma, which was acquired last year by Gilead Sciences Inc. (NASDAQ: GILD).

Investors familiar with the CAR-T space, a type of cancer immunotherapy approach, will recognize these companies. Stanford’s approach here is different from CAR-T. The simplest way of putting it is that the CAR-T approach “glues on” an engineered antigen receptor (a “chimeric” antigen receptor, or CAR) to a patient’s T-cell in an attempt to get the T-cell to recognize and attack a specific cancer. Stanford’s approach only provides the “attack” signal to T-cells that have already infiltrated a tumor but have since been shut off by the tumor’s defense mechanisms.

When a cancer first starts growing inside a patient, the immune system does respond by recognizing the antigens of the cancer and grabbing on. The problem is that the response is usually shut off subsequently by the tumor. So essentially you have these T-cells stuck in the tumor, able to recognize it, but with the command to attack turned off.

While the CAR-T approach has been successful in some cases, it can cause an immune overreaction that itself can kill a patient with its ferocity. With Stanford’s approach, all that is being supplied is the attack command, with immune cells already in the tumor able to recognize and attack already. This both makes the approach simpler and less risky, at least in theory.

The actual treatment combines a section of DNA called CpG oliogdeoxynuleotide that activates T-cells, with an antibody that binds to a protein called OX40 expressed by T-cells when commanded to attack. Unlike CAR-T, the antibody is not tailored to a specific cancer. It is just a general protein that triggers the attack signal. The advantage is that there is much less of a chance of systemic immune overreaction.

The amazing part from preclinical studies is that once the primary tumor was destroyed, these same T-cells, still activated with the attack signal, go after other tumors that were not directly injected, at least according to preclinical data. In the end, solid tumors in 87 of 90 mice were eradicated.

So, while investment via the public markets is not possible yet, if the results of this initial Phase 1 trial are promising, investors can count on the research being bought and brought into public markets via some actor in the CAR-T space or similar area. It’s something to keep an eye on over the next few years, and a great white hope in cancer research.