ALPMF - ESSA Pharma: Unique N-Terminal Domain Approach Might Hinder mCRPC Resistance

2023-11-07 19:06:24 ET

Summary

• A phase 2 study is being advanced using EPI-7386 in combination with enzalutamide to treat patients with metastatic castration-resistant prostate cancer; Positive updated PSA data presented at medical conference.
• EPI-7386 is being advanced as a monotherapy to treat patients with metastatic castration-resistant prostate cancer who have progressed on prior standard of care therapies.
• Additional studies are being done in collaboration with Janssen and Bayer to test the use of EPI-7386 in combination with other drugs for the treatment of mCRPC patients.
• It is expected that the metastatic castrate-resistant prostate cancer treatment market is expected to reach $17.71 billion by 2029.

ESSA Pharma ( EPIX ) has made great progress in being able to advance its pipeline. That's because it is advancing an open-label randomized phase 2 study using EPI-7386 in combination with enzalutamide to treat patients with metastatic castration-resistant prostate cancer [mCRPC] naive to second-generation antiandrogens. This trial is being conducted with Astellas ( OTCPK:ALPMY ) and the goal is to see if this combination is able to help these specific prostate cancer patients. Then, it has another study it is evaluating on its own with EPI-7386 as a monotherapy for the treatment of this same patient population, however it is in patients who have already progressed on current standard of care [SOC] therapies.

A good thing about this biotech is that it is not just relying on these two clinical trials to advance the use of EPI-7386 for the treatment of patients with mCRPC. It has two studies which are primarily being run by Janssen, subsidiary of Johnson & Johnson ( JNJ ) to test out the use of EPI-7386 in combination with other drugs such as abiraterone acetate, prednisone, apalutamide. Then it has another drug that is purely being run by Bayer, which is testing out EPI-7386 in combination with darolutamide for the treatment of the very same patient population. The strength of this biotech is the avoidance of targeting the ligand-binding domain [LBD], where mutations and resistance occurs.

Instead, it does something that other approved antiandrogens don't do, which is that it is targeting the N-terminal Domain [NTD]. This company is definitely moving in the right direction with such a mechanism of action, because it just presented updated dose escalation data from its phase 1/2 study at the 30th Annual Prostate Cancer Foundation Scientific Retreat. It has even gone on to initiate a phase 2 study, which is going to explore the combination of EPI-7386 and enzalutamide, for the treatment of patients with mCRPC naive to second-generation antiandrogens. This is important, because it was stated that once the study starts for several months, that ESSA would be able to give guidance on when to expect data from this study.

EPI-7386 For The Treatment Of Patients With Metastatic Castration-Resistant Prostate Cancer

The main clinical program in ESSA's pipeline would be the advancement of EPI-7386 [masofaniten], which is being advanced in the ongoing phase 2 study . The use of this drug from this biotech is being combined with enzalutamide from Astellas and Pfizer ( PFE ), which has been approved as a treatment for patients with metastatic castration resistant prostate cancer [mCRPC]. Such a study was initiated several months ago on September 18th of 2023 . This trial is going to evaluate the use of EPI-7386 in combination with Xtandi [enzalutamide] for the treatment of patients with mCRPC naive to second generation antiandrogens. The reason why I believe that this ongoing mid-stage study can offer investors an opportunity is because of what was stated by management when it was initiated. It was said that once this trial was underway for several months, that guidance would be given upon when Essa Pharma could release results from it.

This means that it would give an estimated date upon when investors might be able to expect a data release from this particular phase 2 study. It is expected that the metastatic castrate resistant prostate cancer treatment market is expected to reach $17.71 billion by 2029 . This is a large market opportunity and the ability to combat against resistance that occurs with current antiandrogens might be enough to capture a chunk of this market. The good news is that this biotech has already been able to obtain some pretty good activity in terms of being able to show that its drug was able to reduce prostate-specific antigen [PSA] levels when patients were given the EPI-73386 + enzalutamide combination. Such updated phase 1/2 escalation data was presented at the 30th Annual Prostate Cancer Foundation Scientific Retreat, which took place between October 26th - 28th of 2023.

One piece of intriguing data is what was observed across all dose cohorts, whereby 13 out of 16 patients [81%] achieved PSA90 . In addition, 11 out of 16 patients [11 out of 16] achieved PSA90 in less than 90 days. What is PSA90 and why is it important? That's because PSA90 means a ?90% decline in PSA and that's important because higher PSA levels is not a good thing for these mCRPC patients. In essence, the goal is to reduce this PSA protein, which is produced in normal and cancerous cells. Achieving the ?90% decline in PSA is important in determining if a treatment it capable of improving overall survival and achieving radiographic progression-free survival. Another finding is that 56% of patients [9 out of 16] achieved a PSA level of <0.2mg/mL. Why is this finding important? That's because a test result of above this threshold means that the prostate cancer has grown or come back.

Financials

According to the 10-Q SEC Filing , ESSA Pharma had cash reserves and short-term investments of $152.5 million as of June 30, 2023. It believed that this would be enough cash to fund its operations through 2025. However, the company is likely to raise additional cash in the coming months. I believe this to be the case, because just today on November 7th of 2023 it entered into an Open Market Sale AgreementSM with Jefferies. Based on such an agreement Essa could sell of its common shares from time to time as it deems necessary. It can sell up to $50 million in aggregate sales proceeds based on this agreement with Jefferies. Another option it has is with respect to financing would be to raise cash through a mixed shelf offering, which was filed on September 19th of 2023 . This was to where it would be able to sell up to $200 million worth of common shares, preferred shares, debt securities, subscription receipts, warrants and units to raise cash.

Risks To Business

There are several risk that investors should be aware of before investing in ESSA Pharma. The first risk to consider would be with respect to the advancement of EPI-7386 which is being combined with enzalutamide for the treatment of patients with metastatic castration-resistant prostate cancer [mCRPC] naive to second-generation antiandrogens. That's because even though preliminary PSA reduction data in the phase 1 study was good, there is no assurance that similar reductions will be observed in the ongoing phase 2 study when data is finally released.

In addition, there is no assurance that such PSA reductions will translate to improved overall survival [OS], nor achievement of radiographic progression-free survival [rPFS] either. A second risk to then consider would be with respect to other study being advanced, which is using EPI-7386 monotherapy for the treatment of mCRPC patients who progressed on standard of care [SOC therapies. While it seems good that this drug has done well thus far in combination with enzalutamide, there is no guarantee that it will perform well on its own for its intended target population.

The third risk to consider would then be with respect to the advancement of the other studies, which are purely being done by those companies on their own. Such studies being done by other companies, which are incorporating EPI-7386 are as follows:

• Janssen - EPI-7386 + abiraterone acetate + prednisone for the treatment of patients with mCRPC
• Janssen - EPI-7386 + apalutamide for the treatment of patients with mCRPC
• Bayer - EPI-7386 + darolutamide for the treatment of patients with mCRPC

There is no guarantee that EPI-7386 will work with one or any of these other drugs for the treatment of these patients. The fourth and final risk to consider would be with respect to the financial position. That's because even though the guidance is that it has enough cash to fund its operations into 2025, that's not plenty of cash runway. This means that it is quite possible that it could start to look at raising cash at least some point before mid-2024.

Conclusion

ESSA Pharma has made great progress in advancing its pipeline. I believe that this biotech is in great shape, because it has multiple shots on goal in being able to use EPI-7386 alone or in combination with other drugs to treat patients with metastatic castration-resistant prostate cancer. Especially, since it is taking a drastically different approach in doing so, compared to other antiandrogens. Again, it is targeting the N-terminal domain [NTD], which is where the androgen receptor [AR] gene transcription occurs. The thought of this approach is to suppress AR biology independent of the ligand-binding domain [where most other antiandrogens target].

By targeting NTD, ESSA's EPI-7386 can target the AR process in the early stages of disease and may also counteract the resistance that occurs with other antiandrogens. It has been able to establish a few partners who are willing to run some studies using this N-terminal domain targeting approach with EPI-7386 for the treatment of patients with prostate cancer. I believe that value can be unlocked upon the notion that in the coming months this biotech will give guidance upon when it might release results from the ongoing phase 2 study, which is using EPI-7386 in combination with enzalutamide, to treat patients with mCRPC naive to second-generation antiandrogens.

For further details see: