2023-07-07 10:33:28 ET
Summary
- AnaptysBio, Inc. had major deals with big pharma in past years.
- However, its current programs are not that convincing.
- They have a lot of cash from earlier deals.
AnaptysBio, Inc. ( ANAB ) is a late-stage developer of immune therapies. They have 3 active programs in four indications, and two more legacy programs available for out-licensing. Their pipeline is this:
Lead asset Rosnilimab is a PD-1 agonist in a phase 2b trial in Rheumatoid Arthritis. A second candidate, ANB032, a BTLA agonist, is in P2b in Atopic Dermatitis. A third molecule is in IND-enabling stages, i.e., in preclinical development.
I look for data when assessing companies. Interestingly, while Rosnilimab is in a phase 2b trial in RA and you would expect a previous trial in RA, there is none. There is only another phase 2b trial in alopecia areata - the hair loss disease made famous by certain celebrities - but this is an ongoing trial. Thus, there seems to be no clinical data for Rosnilimab. At least, none were available in the official registry .
Thus, it was interesting to see that in 2021, the company did present phase 1 healthy volunteer data from Rosnilimab. Data showed a good safety profile and strong receptor occupancy. Here’s part of the data:
- Rosnilimab, AnaptysBio’s wholly-owned anti-PD-1 agonist antibody, demonstrated favorable safety and tolerability in single and multiple ascending dose healthy volunteer cohorts.
- Robust pharmacokinetic profile, in conjunction with rapid and sustained PD-1 receptor occupancy.
- Pharmacodynamic activity resulted in dose-dependent reduction of PD-1+ T cells and antigen-specific immune response, which we believe supports rosnilimab’s potential to treat T-cell driven human inflammatory diseases.
- Data support monthly subcutaneous rosnilimab dosing in upcoming AZURE Phase 2 placebo-controlled clinical trial in moderate-to-severe alopecia areata patients.
Since this is a phase 1 study, the following safety profile is more important:
Rosnilimab was generally well-tolerated and no dose limiting toxicities were observed. The most frequent adverse event reported among SAD cohorts was increased circulating C-reactive protein levels of mild severity in nine (10%) rosnilimab-dosed subjects occurring sporadically in a dose-independent manner and a severe occurrence in one (3.3%) placebo-dosed subject. MAD cohorts reported headache as the most frequent adverse event with mild occurrences in three (12.5%) rosnilimab-dosed subjects and none in placebo subjects. Mild injection site reactions were observed in two subjects (11.1%) administered with multiple subcutaneous rosnilimab doses. Two serious adverse events were reported in single dose cohorts, including obstructive pancreatitis in a placebo-dosed subject and COVID-19 infection in a rosnilimab-dosed subject leading to discontinuation which was deemed unrelated to treatment. No serious adverse events were reported in subjects receiving multiple doses of rosnilimab or placebo.
2 years ago, this data led to a plan for the AZURE trial in alopecia areata. This trial is still the only one showing against the company name in the registry. However, this indication, as you can well see, is not present in the pipeline any longer. Instead, what we have is rheumatoid arthritis, which is not present in the official registry. The RA p2b trial is supposed to be initiated in Q3 2023, and top line data will occur in 2025.
Besides this study, the other phase 2b molecule, ANB032, does not have a mention under ANAB as sponsor in the registry. Their trials list consists mostly of Imsidolimab or ANB019, which has various trials in multiple indications, however ANB019 is now a legacy molecule looking to out-license. Clearly, this is a trifle worrying.
Interestingly, once again, despite having no mention in the registry, there’s a press release for a phase 1 SAD/MAD (single and multiple ascending dose) study. The molecule had a favorable safety profile. Three severe adverse events (2 blood creatine phosphokinase ((CPK)) increase and 1 aspartate aminotransferase ((AST)) increase) were reported, however none of these were treatment-related. These were from 2 subjects in the MAD cohort.
They state that they initiated a phase 2b study of ANB032 in Q2 in IL-13 mAb naïve and experienced AD patients. Again, there is no record in the registry. This is a U.S. company, so trials would be held in the U.S.; thus, there would be records in the official registry.
My coverage of ANAB in 2021 explains the situation. What I said then:
A failure of one drug does not reflect on another. That's true. However, it's not just the drug's failure but rather management's reticence in being transparent about it that bothers me. At least one of the sources I referred to here concurs.
I was referring to the poor show from one of their two current legacy molecules, etokimab. At that time, imsidolimab was the lead candidate. This is now relegated to being a legacy molecule. You should note, though, that there was a time when AnaptysisBio was something of an R&D powerhouse. Its discovered anti pd-1 molecule, dostarlimab, was licensed to GSK and was approved as Jemperli for the treatment of endometrial cancer. So ANAB has a history of delivering products, but it also seems to have a history of not hitting the mark a few times. ANAB also had royalty rights to GSK’s zejula (niraparib), but sold those rights last year for $45mn.
Financials
ANAB has a market cap of $516mn and a cash balance of $526mn. They did a $50mn stock repurchase program in January. Collaboration revenue was $1.4 million for the three months ended March 31, 2023. Research and development expenses were $35.0 million for the three months ended March 31, 2023, and General and administrative expenses were $10.8 million. At that rate, they have a cash runway till the end of 2026.
In 2014, ANAB collaborated with Tesaro/GSK for three molecules, JEMPERLI (dostarlimab, anti-PD-1 Antagonist) Cobolimab (GSK4069889, anti-TIM-3 Antagonist) and GSK4074386 (TSR-033, anti-LAG-3 Antagonist). The company says that GSK anticipates between $1.2 and 2.4B in peak annual sales for JEMPERLI in currently approved indications and anticipated 1L endometrial/ovarian approvals. ANAB gets 8% of royalties for annual net sales below $1bn, as well as $15mm in regulatory and $90MM in commercial milestones. However, in 2021, ANAB exchanged this for $250mn from Sagard, and will only get back rights to these monies if it pays Sagard back under certain conditions:
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$312.5MM (125% of upfront) by end 2026 or
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$337.5MM (135% of upfront) by end 2027 or
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$412.5MM (165% of upfront) any time after 2027.
However, if Jemperli makes annual net sales above $1bn, then the 12-25% royalties they will earn, and the $75mn milestone, are excluded from this deal.
The other two partnered programs also have 4-5% royalties and $5mm clinical development, $90mm regulatory and $165mm commercial milestones for each program.
Risks
AnaptysBio, Inc. has a number of important molecule discoveries under its belt, but currently seems to be a shadow of its former self. ANAB stock is trading at cash, which is never a good sign. They have cash for their programs from legacy deals, however, the market does not have much faith in the company’s pipeline - this is what trading at cash means for me.
The other risk is the surprising lack of listing of its clinical trials in the official registry. This could mean they are planning these trials, but at least two of these trials are said to have been started, or completed. Yet I find no mention in the registry.
Thus, this leads me to the essential problem with ANAB, that despite their past successes, their current programs simply have no efficacy data in patients. There is no way to properly assess these molecules without such proof-of-concept data.
Bottom Line
AnaptysBio, Inc. stock is down 33% since my 2021 coverage , when, too, I had a negative view. I retain that view still now, and will stay on the sidelines.
For further details see:
AnaptysBio: Despite Early Successes, Current Situation Does Not Impress