NRIX - Nurix: Promising Early Data From This Protein Degrader Company

2023-03-19 23:39:45 ET

Summary

• NRIX announced early data at ASH last year.
• The company has a couple of major partnerships.
• They have a decent cash runway.

Nurix Therapeutics ( NRIX ) works in the field of targeted protein degradation in order to attack cancer cells. The company was initially funded and launched by Third Rock Ventures. In its early days, it started a partnership with Celgene. In the last 3 years, it has had major deals with Gilead ( GILD ) and Sanofi ( SNY ) for its novel protein degrader platform.

NRIX has an early stage pipeline, but the company presented early data at ASH last year which shows, the company says, drug benefit. The data is from lead asset NX-2127, “a novel bifunctional molecule that degrades Bruton’s tyrosine kinase (BTK') and cereblon neosubstrates Ikaros (IKZF1) and Aiolos (IKZF3).” Data presented at ASH 2022 in two papers showed that NX-2127 demonstrated clinically meaningful responses in heavily pretreated chronic lymphocytic leukemia ((CLL)) patients in a BTK mutation-agnostic manner, and multiple types of BTK mutations could be degraded by NX-2127. A Complete Response or CR was also observed in a DLBCL patient.

Data was presented from a phase 1 trial in 36 adults with relapsed/refractory B-cell malignancies, including 23 patients with CLL who had failed a median of five prior therapies including a BTK inhibitor. These patients were not only heavily pretreated, but approximately 48% also had BTK resistance mutations. The data was not overwhelming but that was because of this heavily pretreated population. Otherwise, it was quite good:

Following treatment with NX-2127 in this heavily pretreated CLL population, sustained BTK degradation and decreased B cell activation were observed regardless of prior treatment and baseline BTK mutation status with an overall response rate ((ORR)) of 33% (95% CI 12–62%). As of September 21, 2022, the data cut-off date, the median follow up was 5.6 months (0.3 to 15.7 months), and 14 of 23 patients remained on treatment. Importantly, the safety profile of NX-2127 was consistent with prior results from the Phase 1a portion of the trial and reports for BTK-targeted therapies in heavily pretreated patients with B cell malignancies.

Coming to the science behind BTK degradation, the B-cell receptor signaling pathway is an important target for various therapies targeting B-cell malignancies. BTK is a key component of BCR. There are a number of BTK inhibitors in the market. However, various BTK mutations cause treatment resistance. NX-2127 is a small molecule that degrades BTK and can be effective in overcoming resistance to BTK inhibitors, particularly in patients refractory to, or relapsed from, BTK inhibitors.

Nurix has two platforms that differentially modulate E3 ligases. Other rival protein degrader companies include Arvinas, Kymera and C4. According to company management, Nurix' key differentiation is that "while other companies focus primarily on binders for CRBN and vHL, Nurix has identified binders for those and 12 other ligases. ...Nurix’s DNA-encoded library of compounds has given the company access to novel chemical matter to discover new ligases."

The entire pipeline looks like this:

NX-5948 has dosed the first patient in the UK, and an IND has been cleared in the US after the molecule demonstrated clear signals of BTK degradation, including by crossing the blood brain barrier and targeting brain-resident lymphoma cells. NX-1607 also cleared an US IND after demonstrating drug activity.

Financials

NRIX has a market cap of $425mn and a cash balance of $373mn. Research and development expenses for the three months and twelve months ended November 30, 2022 were $46.1 million and $184.5 million, respectively, while general and administrative expenses for the three months and twelve months ended November 30, 2022 were $9.4 million and $38.0 million, respectively. At that rate, the company has a cash runway of 6-7 quarters.

Nurix has major collaboration deals with Gilead and Sanofi. Each deal is for two drug candidates, and Nurix has a 50/50 US codevelopment option for each partnered drug. Gilead paid $45mn upfront, while SNY paid $77mn upfront. Gilead and SNY may still pay $2.3bn and $2,5bn respectively in development, regulatory and sales milestones plus royalties. Thus, these are quite respectable partnerships for a small company.

NRIX has a high percentage of institutions and fund ownership, at almost 95% of the float. Key owners are all the big names including Baker Bros, BlackRock (BLK), T. Rowe Price (TROW) and so on. Insiders have little interest in either buying or selling the stock. For the last two years, there are only option exercises (sale).

Bottomline

Nurix is an early stage company but they have a good amount of cash and some solid if early data. The market is pretty much ignoring their pipeline and valuing it almost at cash (enterprise value is less than $100mn). I think NRIX stock is worth watching.

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