(Source of data: Bloomberg.com)
Atara Biotherapeutics (ATRA) was founded in 2012 and is based in Southern San Francisco, California. The company’s key developmental program is focused on developing off-the-shelf allogeneic T cell therapies against certain malignancies.
It is an allogeneic, CD-19 targeted, T-cell therapy which is being developed against Epstein-Barr virus (EBV) associated, post-transplant lymphoproliferative disorder, PTLD and other EBV associated malignancies like nasopharyngeal cancer.
Tab-Cel EBV-PTLD phase program:
It is the key valuation driver and the most advanced program for the company at present. The phase 3 program consists of two ongoing open-label, phase 3 trials: ALLELE (EBV-PTLD after solid organ transplant, SOT) and MATCH (EBV-PTLD after hematopoietic stem cell transplant, HSCT. The single-arm, open-label design should be sufficient for regulatory approval considered excellent phase 2 clinical data in phase 2 trials as mentioned below.
EBV-associated PTLD can occur up to 1 year after HSCT and can occur at any time after SOT due to chronic immunosuppression. The current treatment for EBV-PTLD is rituximab +/- chemotherapy. The mortality is high in rituximab refractory patients and the average survival is 15-65 days in post-HSCT patients with rituximab refractory EBV-PTLD.
Tab-Cel has shown excellent response in rituximab refractory EBV-PTLD. The company’s investor presentation has a case report of a patient achieving complete response in rituximab refractory EBV-PTLD. The objective response rate in the phase 2 trial was 80% in post-HSCT patients and 83% ORR in post-STP patients. Per the company’s presentation, the threshold to meet the phase 3 endpoint is 37% ORR. Therefore, the phase 3 program has a high probability of success.
Due to the excellent data, FDA has awarded Breakthrough therapy designation to Tab-Cel for EBV-associated post transplant PTLD.
In the phase 2 study, Tab-Cel also extended the median overall survival in these patients as well as the proportion of patients surviving for at least one year (64%-68% as shown in the figure above vs. just 36% for rituximab refractory post STP patients).
Another KOL, an oncologist at the St. Louis University Medical Center who has approximately 40 EBV-PTLD patients under treatment also reported excellent results from using Tab-Cel. All her rituximab refractory patients achieved complete response and have not relapsed.
The company recently released its Q1 earnings call. The phase 3 data was expected to be released in Q2 this year but the data has now been delayed till next year. As per the earnings call, the patient enrollment is going slower than expected since this is a rare disease so the challenge is in identifying and enrolling these patients. The management is addressing these challenges by expanding the enrollment site beyond 32 sites.
The management is planning the European regulatory application submission in 2020 based on the existing data where Tab-Cel has EU PRIME designation. The phase 3 program data could be expected after the EU regulatory submission.
Tab-Cel in EBV-associated refractory metastatic nasopharyngeal cancer:
The current standard of treatment in these patients is platinum-based chemotherapy +/- targeted therapy. The median survival is 5-11 months with the standard treatment.
In a phase 1 trial as monotherapy in second-line metastatic patients, Tab-Cel showed 21% overall response rate and 84% 2-year overall survival. A phase Ib/II trial in EBV-associated nasopharyngeal cancer in combination with Keytruda is ongoing.
Other EBV-associated cancers:
EBV may also be associated with certain lymphomas, gastric cancer and leiomyosarcomas. A phase 2 multi-cohort study is planned in these indications.
Manufacturing: the company has its own manufacturing facility in California.
T cell therapy against multiple sclerosis:
EBV has also been associated with multiple sclerosis, MS. Loss of EBV-specific CD8+ T cell function correlates with MS progression. Autologous T cell therapy ATA190 showed encouraging results in 10 patients with progressive MS. After 6 weeks of treatment and 20 weeks of follow-up, 70% patients experienced both symptomatic and objective neurological improvement. A randomized phase 2 study is expected to start in the second half of 2019.
ATA-188 is an allogeneic CAR-T therapy which is being tested in a phase 1 study in progressive multiple sclerosis. A multicenter, open-label study is ongoing in the U.S. and Australia. Initial safety results are expected at the EAN conference this year. More safety and efficacy data is expected in the second half this year.
Next generation CAR-T programs:
Mesothelin-targeted autologous, CAR-T program:
This program was licensed from the Memorial Sloan Kettering Medical Center, MSK in New York. Mesothelin is expressed in various tumors, for example in 90% of mesothelioma, 35% of triple-negative breast cancer and 80% of pancreatic cancer. An estimated prevalence of mesothelin associated cancers ia approx. 2 million and annual incidence of approx. 340K patients.
MSK scientists presented phase 1 clinical data in this indication at the recently concluded annual conference of the American Association for Cancer Research, AACR, primarily in malignant pleural mesothelioma, MPM (21 patients, 19 with mesothelioma, one with refractory metastatic lung cancer and one with refractory metastatic breast cancer). The CAR-T therapy was administered intrapleurally in combination with anti-PD1 checkpoint inhibitor, Keytruda and showed excellent clinical response and was well tolerated. The best overall response rate was 72% in 11 MPM patients who also received Keytruda and lymphodepleting chemotherapy, including 2 complete metabolic responses on PET scan and six partial responses.
Atara Biotherapeutics has filed IND to start its own clinical trials for the next generation version of this mesothelin-targeted autologous CAR-T using MSK’s novel 1XX CAR signaling domain and PD-1 dominant negative receptor checkpoint inhibition technologies.
Key near-term milestones:
- Initial safety results from autologous ATA190 in MS: EAN conference in June this year.
- Additional phase 1 data from the phase 1 trial of mesothelin-targeted CAR-T therapy in malignant pleural mesothelioma will be presented by MSK investigators at the annual ASCO conference in June this year.
CEO and founder Isaac Ciechanover served as the Executive Head of Business development at Celgene. He also served as the Global Project Leader for Celgene’s first clinical-stage biologic therapy. Dietmar Berger, Global Head of R&D served as the Senior Vice President and Global Head, Product Development, Clinical Science Hematology and Oncology at Roche/Genentech (RHHBY). Chief Scientific Officer, Christopher Haqq served as the Vice President for Clinical Research and Development at Cougar Biotechnology and Johnson & Johnson’s Janssen (JNJ). Chief Technical Operations Officer, Joe Newell served as Vice President, North America Manufacturing at Alexion Pharmaceuticals (ALXN). He also worked in several leadership roles in Amgen in manufacturing and supply chain. Chief Medical Officer, AJ Joshi served as US Medical Affairs Therapeutic Area Head at Allergan (AGN), SVP Strategic Development and Medical Operations at Synageva, and Vice President Medical Affairs and Operations at Genzyme. Derrell Porter, SVP, Global Commercial Head served as a VP at Gilead (GILD).
The company is well-funded with $237M in cash reserves as of Q1 this year. There is no long-term debt. Operating cash burn was $179.7M in 2018. The management expects cash reserves to be enough till mid-2020. The balance sheet is shown in the figure below.
Target market assessment:
Nearly all cases of PTLD that occur following HCT are EBV positive (1% cumulative incidence at 10 years for post-HSCT PTLD) while approximately 70% of PTLD cases that occur following SOT are EBV positive. Approx. 40-60% patients don’t respond to first line therapy like rituximab.
Annual number of HSCT, U.S.= approx. 22,000.
Estimated number of rituximab refractory EBV-PTLD cases= 130
Annual number of solid organ transplants, U.S.=36,000
Estimated number of rituximab refractory EBV-PTLD cases= 210
Estimated cumulative revenue opportunity at $350K/patient= $120M
Estimated number of rituximab refractory EBV-PTLD cases= 650
Estimated cumulative revenue opportunity at $350K/patient= $227M
Malignant pleural mesothelioma:
Approx. U.S. annual incidence= 3000 cases
Approx. U.S. annual revenue opportunity, at $350K/year= Approx. 1 billion
EBV-associated nasopharyngeal cancer:
EBV prevalence in squamous cell nasopharyngeal cancer= 60%.
It affects approx. 2 million people worldwide and approx. 800K people in the US and EU. Approx. 30-35% patients have progressive MS.
Approx. cumulative revenue opportunity at $350K/patient= $9.8 billion
Current market cap= $1.1 billion
Rating Atara Therapeutics common stock Buy with 2-3 year timeframe.
Risks in the investment: A significant part of the valuation at present is driven by the programs in mesothelioma and MS which are in early stage. The efficacy seen in early clinical trials may not be seen in late stage trials and unexpected side effects may be seen. Newer, more effective treatments may be seen in the near future which may limit the market share of the company in the planned indications. The company is also likely to need significant amount of capital before any product candidate reaches the commercial stage.
Disclaimer: This article represents my own opinion and is not a substitute for professional investment advice. It does not represent a solicitation to buy or sell any security. Investors should do their own research and consult their financial adviser before making any investment. Investing in equities, especially biotech stocks has the risk of significant losses and may not be suitable for all investors. While the sources of information and data in this article have been checked, their accuracy cannot be completely guaranteed.
I/we have no position in ATRA but may buy a long position within next 72 hours.