HARP - Harpoon: HPN328 Data In 1st Half Of 2024 Makes This A Must Watch

2023-11-21 09:00:00 ET

Summary

• HPN328 is being advanced in a phase 1/2 study for the treatment of patients with neuroendocrine tumors; Promising interim data was released at ESMO 2023 medical conference.
• Updated data from the phase 1/2 study, using HPN328 for the treatment of patients with neuroendocrine tumors, is expected to be released in the 1st half of 2024.
• The global neuroendocrine tumors treatment market revenue is expected to increase to $6.33 billion by 2030.
• PIPE financing agreement brought in $100 million upfront and then possibly $50 million if warrants are exercised; including all of the latest financing, enough cash to fund its operations into 2026.

Harpoon Therapeutics (HARP) has been making great progress in being able to advance its pipeline, that's because it has done well in advancing its drug HPN328 for the treatment of patients with small cell lung cancer [SCLC], neuroendocrine prostate cancer [NEPC] and other neuroendocrine cancers. Such a drug is being advanced in a phase 1/2 study, whereby interim data reported at the ESMO medical conference in 2023 was highly encouraging. The reason why I believe it is important to go over this biotech is because there are two value-creating events that investors can look forward to in the coming year.

The first of which is that the recommended phase 1/2 dose of HPN328, for the treatment of patients with neuroendocrine tumors, is expected before the end of 2023. The second of which involves another data readout, which is expected to happen in the early part of next year. It is expected that Harpoon Therapeutics is going to release updated data from this very same phase 1/2 study by the 1st half of 2024. Should things go well for this biotech, then it is possible that it could initiate one or multiple phase 2/3 studies exploring the use of HPN328 for the treatment of patients with neuroendocrine tumors by the 2nd half of 2024.

HPN328 For The Treatment Of Patients With Neuroendocrine Tumors

As I stated above, Harpoon Therapeutics is advancing the use of its drug HPN328 for the treatment of patients with neuroendocrine tumors. The global neuroendocrine tumors treatment market revenue is expected to increase to $6.33 billion by 2030 . It is advancing the use of this drug for the treatment of this patient population in an ongoing phase 1/2 study. Such a study is trying to identify the recommended phase 3 doses[s] to be used in later testing. The reason why I believe that this program is on the right track is because it has already been able to report positive interim results from this particular trial . Matter of fact, such data was presented at the European Society of Medical Oncology Congress [ESMO] 2023. It was noted that patients treated with HPN328 were able to achieve substantial response rates. I don't state this lightly, but my reasoning is because of what was able to be achieved when patients were only given a 1 mg priming dose of this drug. The preliminary response rate achieved across all tumor types, when patients were given this particular dose, was 35% [11 out of 31 patients]. When the response rates were broken down into the targeting of specific tumor types, the data was as follows:

• Small cell lung cancer [SCLC] response - 32% [6 out of 19 patients]
• Other neuroendocrine tumor types response - 42% [5 out of 12 patients]

This is some good data, especially when this was just patients only given a 1 mg priming dose. The reason why I believed it was important to go over Harpoon Therapeutics is because of the catalysts that are rapidly approaching. The first catalyst of which, would be a value-creating event which might be the selection of the recommended phase 2 dose [RP2D] from the ongoing phase 1/2 study, which is using HPN328 for the treatment of patients with SCLC and other neuroendocrine tumor types. The selection of the RP2D is key to the advancement of this program and is recommended to occur before the end of 2023. A second catalyst, that I believe would be another important development as part of this program, would be the release of updated phase 1 data from this phase 1/2 trial. Such updated data from this trial is expected to be released in the 1st half of 2024. Barring positive data being released on this coming update, this would set up the last catalyst to expect as it relates to this particular program. It is possible that Harpoon might get the green light from the FDA to initiate one or more phase 2/3 studies, using HPN328 to treat patients with SCLC and other neuroendocrine tumor types. Such studies could be initiated by the 2nd half of 2024, pending positive discussions with the FDA and/or other regulators.

Financials

According to the 10-Q SEC Filing , Harpoon Therapeutics had cash, cash equivalents, and short-term marketable securities of $31.6 million as of September 30, 2023. This was a low amount of cash and no way it was going to carry the company forward for an extended period of time. As such it chose to raise cash in October of 2023. Specifically on October of 2023, it entered into a securities purchase agreement for a private placement in public equity [PIPE] financing , which is expected to bring in upfront gross proceeds of about $100 million. It may also earn up to an additional $50 million in gross proceeds upon the exercise of warrants as well, which would be great as it would extend its cash runway even further. The $100 million upfront funding, along with the possible exercise of $50 million in cash warrants, would extend its cash runway into 2026. Even if it doesn't get the additional $50 million in cash warrants, it will still be able to fund itself into the 2nd half of 2025 anyway. Thus, it has plenty of time to get through the many milestones that are rapidly approaching.

Risks To Business

There are several risks that investors should be aware of before investing in Harpoon Therapeutics. The first risk to consider would be with respect to the advancement of HPN328 in the phase 1/2 study, which is being used to treat patients with neuroendocrine tumors. Updated phase 1 data from this study is expected to be released in the 1st half of 2024. There is no assurance that such updated data to be released from this trial will turn out to be positive. A second risk to then consider would be with respect to the recommended phase 2 dose [RP2D] and the possible phase 2/3 studies, whereby HPN328 is going to be incorporated in. While some positive activity has been achieved thus far with this drug for the treatment of these patients, there is no guarantee that the FDA will give the green light so that Harpoon can begin a late-stage study. A third and final risk to consider would be with respect to another phase 1/2 trial, which is going to test the use of HPN328 in combination with TECENTRIQ [atezolizumab] for the treatment of patients with small-cell lung cancer [SCLC]. While positive data has been observed thus far with respect to this drug being used alone as a monotherapy against SCLC, there is no guarantee that adding in TECENTRIQ is going to end up with a superior outcome compared to monotherapy HPN328 alone.

Conclusion

Harpoon Therapeutics has made great progress in advancing its pipeline, especially with its lead drug HPN328, which is being advanced for the treatment of patients with neuroendocrine tumor types. The global neuroendocrine tumors treatment market revenue is expected to increase to $6.33 billion by 2030. As I displayed above, it did fairly well in generating responses in these neuroendocrine tumors, achieving a 35% across all of these tumor types. It hopes to be able to capitalize on this opportunity by using HPN328 alone, however, it does have other plans to combine this drug with TECENTRIQ to treat patients with SCLC specifically. Although it remains to be seen if this combination can yield a superior outcome over HPN328 alone, it still provides another shot on goal for its pipeline. Lastly, it does have another program in the pipeline, which is HPN217 which is advanced for the treatment of patients with multiple myeloma [MM]. This is another large market opportunity, should things play out well from an ongoing phase 1 study. It is expected that the global Multiple Myeloma market size is projected to reach $31 billion by 2026 . This phase 1 study is ongoing and a recommended phase 2 dose [RP2D] for this program is also expected to be announced by the end of 2023.

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