On November 14, 2022 Sesen Bio (Nasdaq: SESN) reported operating results for the third quarter ended September 30, 2022, and provided a business update (Press release, Sesen Bio, NOV 14, 2022, View Source [SID1234623287]).

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Business Updates

On September 21, 2022, Sesen Bio announced that it had entered into a definitive merger agreement with Carisma Therapeutics (Carisma). The combined company will focus on the development of Carisma’s chimeric antigen receptor macrophage (CAR-M) therapies, which are believed to be the only therapies of their kind with demonstrated proof of mechanism and safety data in clinical trials.
Immediately following the merger, pre-merger Sesen Bio stockholders are expected to own approximately 41.7% of the combined company and pre-merger Carisma stockholders are expected to own approximately 58.3% of the combined company, in each case before giving effect to a $30.6 million concurrent financing by Carisma and the conversion into shares of common stock of the combined company of a $35.0 million outstanding convertible note from one of Carisma’s key strategic partners, Moderna.

Immediately prior to the closing of the merger, Sesen Bio stockholders of record as of a date agreed to by Sesen Bio and Carisma will be issued a Contingent Value Right (CVR) for each outstanding share of Sesen Bio common stock held as of such date, representing the right to receive contingent cash payments upon the receipt by Sesen Bio of certain proceeds payable by Roche, if any, related to the asset purchase agreement with Roche for EBI-031 and all other IL-6 antagonist monoclonal antibody technology (Roche Asset Purchase Agreement) subject to customary deductions, including for expenses and taxes.

The combined company is expected to have approximately $180.0 million in cash, cash equivalents and marketable securities at the closing of the merger, which is expected to advance Carisma’s pipeline through upcoming catalysts and development milestones across its clinical programs.

The combined company will be led entirely by Carisma’s current management team, which has extensive cell therapy experience and a strong track record in oncology and drug development. This includes Carisma CEO Steven Kelly, who was named Ernst & Young Entrepreneur of the Year 2022 Greater Philadelphia1, and Carisma Chief Scientific Officer and co-founder Michael Klichinsky, Pharm.D., Ph.D.

On July 18, 2022, Sesen Bio announced it was voluntarily pausing further clinical development of Vicineum in the US and that it intends to seek a partner to continue Vicineum’s development. Sesen Bio remains focused on closing the proposed transaction with Carisma while it continues to evaluate potential opportunities for Vicineum.
On November 1, 2022, Carisma announced the acceptance of multiple abstracts to be presented at the upcoming Society for Immunotherapy of Cancer (SITC) (Free SITC Whitepaper) 37th Anniversary Annual Meeting in Boston, Massachusetts, which is being held November 8 to November 12, 2022. Accepted abstracts include two abstracts of its clinical trial data, including one for oral presentation, four abstracts of pre-clinical study data, and one abstract overviewing the design of a Phase 1 clinical trial for CT-0508.
Third Quarter 2022 Financial Results

Cash Position: Cash, cash equivalents and marketable securities were $184.9 million as of September 30, 2022, compared to cash and cash equivalents of $162.6 million as of December 31, 2021.
Total Revenue: Total revenue for the three months ended September 30, 2022 was $40.0 million, which was due to the execution of the Roche Asset Purchase Agreement.
R&D Expenses: Research and development expenses were $2.9 million for the three months ended September 30, 2022, compared to $5.0 million for the three months ended September 30, 2021. The decrease of $2.0 million was primarily due to a decrease in costs associated with manufacturing ($1.9 million) and a decrease in other R&D related costs ($0.1 million), driven by the strategic decision to voluntarily pause further development of Vicineum in the US in the third quarter of 2022.
G&A Expenses: General and administrative expenses were $8.1 million for the three months ended September 30, 2022, compared to $8.7 million for the three months ended September 30, 2021. The decrease of $0.6 million was primarily due to a decrease in marketing and commercialization expenses, which were incurred in preparation for potential commercial launch of Vicineum but were discontinued as a result of the Complete Response Letter (CRL) from the US Food and Drug Administration (FDA) received in August 2021 ($2.3 million) and a decrease in professional fees for accounting services ($0.4 million). This was partially offset by an increase in legal expense ($1.3 million), driven by legal fees associated with our assessment of strategic alternatives incurred in the third quarter of 2022 ($2.2 million), partially offset by a decrease in legal fees associated with the internal review ($0.4 million) and other legal expenses ($0.5 million). Additionally, financial advisor fees increased due to the Company’s assessment of strategic alternatives in the third quarter of 2022 ($0.8 million).
Restructuring Charges: Restructuring charges were $10.9 million for the three months ended September 30, 2022, compared to $5.5 million for the three months ended September 30, 2021. Restructuring charges for the third quarter of 2022 consisted of severance and other employee-related costs ($6.9 million) and termination of certain contracts and other associated costs ($4.0 million) associated with the restructuring plan approved on July 15, 2022, following the decision to voluntarily pause further development of Vicineum in the US. Restructuring charges for the third quarter of 2021 consisted of severance and other employee-related costs ($2.8 million) and termination of certain contracts ($2.7 million) associated with the restructuring plan approved on August 30, 2021, following the receipt of the CRL.
Non-Cash Related Expenses:
The Company did not record any intangibles impairment charge for the three months ended September 30, 2022, and the Company recorded an intangibles impairment charge of $31.7 million in the three months ended September 30, 2021. In light of the CRL, the Company performed an interim impairment test for In-Process Research and Development (IPR&D) assets, which resulted in the decrease in fair value of Vicineum’s US rights.
The non-cash change in fair value of contingent consideration was a gain of $1.8 million for the three months ended September 30, 2022, compared to a gain of $114.0 million for the three months ended September 30, 2021. The gain from the fair value of contingent consideration of $1.8 million for the three months ended September 30, 2022, was due to the Company’s conclusion that it no longer expects to make earnout payments to Qilu Pharmaceutical Co., Ltd. for commercialization of Vicineum in the Greater China region. Accordingly, the Company reduced the remaining $1.8 million of contingent consideration liabilities to zero as of September 30, 2022. The gain from the fair value of contingent consideration of $114.0 million for the three months ended September 30, 2021, was primarily due to management’s assessment of a lower probability of regulatory success of Vicineum, and a refinement of associated timelines, following the CRL.
Income Tax Benefit: The Company did not record a benefit or loss for the three months ended September 30, 2022. In the third quarter of 2021, the Company determined that the fair value of the Company’s intangible asset of Vicineum US rights was zero, which resulted in an impairment charge of $31.7 million. In connection with this impairment charge, in the third quarter of 2021, the Company reduced the associated deferred tax liability, which resulted in an income tax benefit of $8.6 million.
Net Income: Net income was $20.5 million, or $0.10 per basic and $0.10 per diluted share, for the third quarter of 2022, compared to $71.7 million, or $0.36 per basic and $0.36 per diluted share, for the third quarter of 2021. The decrease was primarily attributable to unfavorable changes in non-cash related expenses of $89.1 million (including tax benefit) and increased restructuring charges of $5.4 million. This was partially offset by revenue of $40.0 million related to the execution of the Roche Asset Purchase Agreement.
1: Award presented by Ernst & Young; winners are selected by a panel of independent judges based on their demonstration of long-term value through entrepreneurial spirit, purpose, growth and impact, among other core contributions and attributes.

On November 13, 2022 SK Biopharmaceuticals, a global innovative pharmaceutical company, reported that the state-run Korea Drug Development Fund (KDDF) has decided to support and finance the company’s development of SKL27969, which is being evaluated as potential treatment for patients with advanced solid tumors, widening SK Biopharmaceuticals’ area into oncology (Press release, SK biopharmaceuticals, NOV 13, 2022, View Source [SID1234623907]).

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The KDDF is a government fund that aims to support R&D for new drug development as part of efforts to advance Korea’s pharmaceuticals and biotechnology sectors.

A phase 1/2 clinical trial is being conducted under the US IND for SKL27969, a PRMT5 inhibitor, in adult patients with solid tumors for safety, tolerability, pharmacokinetics, pharmacodynamics, and preliminary efficacy.

SK Biopharmaceuticals said the KDDF’s two-year investment in the study will help the company and its U.S. subsidiary SK Life Science, Inc. to accelerate their clinical (Phase 1) and nonclinical trials, while expanding its oncology network.

SK Biopharmaceuticals will present its preclinical data of SKL27969 at the annual Society for Neuro-Oncology (SNO) conference in Tampa Bay, Florida, November 16 – 20, 2022.

About SKL27969

SKL27969 is a protein arginine methyltransferase 5 (PRMT5) inhibitor candidate that has shown activity in preclinical models of solid tumors, such as glioblastoma (GBM), non-small cell lung cancer (NSCLC), and triple negative breast cancer (TNBC).

On November 13, 2022 Akeso, Biopharma (9926. HK) ("Akeso") reported that the Center for Drug Evaluation (CDE) of the China National Medical Products Administration (NMPA) has granted Breakthrough Therapy Designation (BTD) for Ivonescimab (PD-1/VEGF bispecific antibody, AK112) combined with docetaxel for the treatment of locally advanced or metastatic Non-Small-Cell Lung Carcinoma (NSCLC) patients who failed to respond to prior PD-(L)1 inhibitor combined with platinum-based doublet chemotherapy (Press release, Akeso Biopharma, NOV 13, 2022, View Source [SID1234623906]). This is the third BTD for AK112 for use with NSCLC patients, and AK112 is the only drug candidate granted BTD for PD-(L)1 resistant lung cancer treatment in China.

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The three BTDs of AK112 comprise:

AK112 combined with chemotherapy for the treatment of EGFR-mutated locally advanced or metastatic NSCLC patients who have failed to respond to EGFR-TKI treatment, which has completed Phase III clinical trials patient enrollment.
AK112 as the first-line treatment for locally advanced or metastatic NSCLC patients with positive PD-L1 expression, which has entered into Phase III clinical trials.
AK112 combined with docetaxel for the treatment of locally advanced or metastatic NSCLC patients who failed to respond to prior PD-(L)1 inhibitor combined with platinum-based doublet chemotherapy, which is the only drug candidate granted BTD for PD-(L)1 resistant lung cancer treatment in China.
Breakthrough Therapy Designations aim to accelerate development and regulatory review of new drugs to treat severe diseases which show encouraging preliminary clinical results. These drugs need to demonstrate a significant improvement in clinical endpoints over existing therapies, or fulfill unmet medical needs. Akeso believes that these three designations of AK112 for NSCLC will accelerate the R&D and marketing progress of AK112 in China.

PD-1/L1 monoclonal antibody combined with platinum-based chemotherapy is the standard of care for first-line therapy for patients with advanced NSCLC. However, the majority of patients do not benefit from the treatment or may relapse after a period of response, highlighting the need for more effective treatment. However, there are currently no immunotherapy regimens approved for NSCLC patients who failed to respond to prior PD-(L)1 inhibitor combined with platinum-based doublet chemotherapy.

Immunotherapy plus anti-angiogenesis therapy has proven its combined advantages in previous studies worldwide. Lung cancer is one of the mainstream exploration areas of this therapy. AK112 can potentially simultaneously block PD-1 and VEGF targets, and has demonstrated a favorable safety profile and promising anti-tumor efficacy in recent studies conducted by the Company. AK112 is expected to provide a valuable option for NSCLC patients to overcome immunotherapy resistance antibody therapy.

ABOUT IVONESCIMAB (PD-1/VEGF BI-SPECIFIC ANTIBODY, AK112)

Ivonescimab is a first-in-class and the first to enter phase III clinical trial PD-1/VEGF bi-specific antibody independently developed by Akeso Biopharma. Engineered with our unique Tetrabody technology, Ivonescimab blocks PD-1 binding to PD-L1 and PD-L2, and blocks VEGF binding to VEGF receptors. PD-1 antibody combined with VEGF blocking agents have shown robust efficacy in various tumor types (including renal cell carcinoma, non-small cell lung cancer and hepatocellular carcinoma). In view of the co-expression of VEGF and PD-1 in the tumor microenvironment, Ivonescimab, as a single agent to block these two targets, may block these two pathways more effectively and enhance the antitumor activity, as compared to combination therapy.

Currently, Akeso is conducting a phase III clinical trial of AK112 monotherapy versus Pembrolizumab monotherapy as the first-line treatment for NSCLC patients with positive PD-L1 expression. In addition, a phase III clinical trial of AK112 plus chemotherapy versus chemotherapy in EGFR mutated advanced non-squamous NSCLC that failed in prior EGFR-TKI therapy is ongoing. AK112 has started multiple clinical trials for various stages treatment of indications including non-small cell lung cancer and small cell lung cancer.

On November 13, 2022 Innovent Biologics, Inc. ("Innovent") (HKEX: 01801), a world-class biopharmaceutical company that develops, manufactures and commercializes high quality medicines for the treatment of oncology, autoimmune, metabolic, ophthalmology and other major diseases, reported the updated results of IBI351 (GFH925) (KRASG12C inhibitor) from a phase Ia clinical trial (NCT05005234) at the 2022 Chinese Society of Clinical Oncology (CSCO) Annual Meeting (Press release, Innovent Biologics, NOV 13, 2022, View Source [SID1234623905]).

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Phase Ia study of IBI351 (GFH925) monotherapy in patients with advanced solid tumors: updated results

IBI351(GFH925) is a novel, irreversible covalent inhibitor of KRASG12C mutation. The NCT05005234 study presented was a first-in-human study conducted in China to evaluate the safety, tolerability and efficacy of IBI351 monotherapy in patients with advanced solid tumors who failed or intolerant to standard of care treatment. As data cutoff (29 July 2022), 67 subjects were enrolled in the study, including 61 patients with non-small cell lung cancer (NSCLC), 5 colorectal cancer(CRC) and 1 pancreatic cancer. Approximately 50% patients received 2 lines or above prior systemic anticancer therapy. 37.7% of NSCLC patients had brain metastases. The highlights of the study results were as follows:

Of 55 evaluable NSCLC patients, 28 achieved partial response (PR), with investigator assessed ORR 50.9% and DCR 92.7%. As data cutoff, most patients remained on treatment. Sustained treatment response was observed at low dose of IBI351. Median duration of response (DOR) and median progression free survival (PFS) were not reached yet.
Of 21 patients with NSCLC treated at 600mg BID (the recommended phase 2 dose), better efficacy signal was observed, with investigator assessed ORR 61.9%(13/21) and DCR 100%.
Of 5 CRC patients, 3 achieved PR, with investigator assessed ORR and DCR 60%. 1 pancreatic cancer patient achieved PR in 1st tumor assessment, and remained on treatment.
As data cutoff, IBI351 was well tolerated. No DLT was reported and MTD was not reached. Treatment-related adverse events (TRAEs) occurred in 92.5% (62/67) patients and the most common TRAEs were anemia, transferase increased, bilirubin increased, pruritus and fatigue. The majority of the TRAEs were grade 1-2 with 19.4% (13/67) of patients reporting grade 3 or higher TRAEs. There were no grade 5 TRAEs or TRAEs led to treatment discontinuation.
Favorable safety and tolerability and promising antitumor activity of IBI351 monotherapy were observed in previously-treated advanced NSCLC, CRC and pancreatic cancer harboring KRASG12C mutation. A single arm registrational trial of IBI351 monotherapy in previously-treated advanced non-small cell lung cancer is ongoing. More data will be presented at the future medical meeting.

Professor Yi-Long Wu from Guangdong Lung Cancer Institute, Guangdong Provincial People’s Hospital, stated: "KRAS mutation as the "undruggable" target for decades has become one of the most popular direction for clinical development recently. IBI351 is a novel, irreversible covalent inhibitor of KRASG12C mutation, whose preliminary data of safety and efficacy was reported at 2022 ASCO (Free ASCO Whitepaper). The update data shows the favorable safety and promising activity of IBI351 (GFH925) monotherapy in KRAS G12C mutated advanced solid tumor. We look forward to more positive clinical data from this study. "

Dr. Hui Zhou, Senior Vice President of Innovent, stated: "We are pleased to present our clinical development updates at the 2022 CSCO, and that IBI351 monotherapy demonstrated encouraging efficacy and safety data in phase Ia study. A single arm registrational trial of IBI351 monotherapy in previously-treated advanced NSCLC is ongoing. We are working to advance into late stage clinical development to explore the potential of IBI351 as monotherapy and in combo-therapy. We are actively exploring next-generation immunotherapies, hoping to benefit more cancer patients."

About IBI351/GFH925 (KRASG12C Inhibitor)

Discovered by GenFleet Therapeutics, GFH925 (Innovent R&D code: IBI351) is a novel, orally active, potent KRASG12C inhibitor designed to effectively target the GTP/GDP exchange, an essential step in pathway activation, by modifying the cysteine residue of KRASG12C protein covalently and irreversibly. Preclinical cysteine selectivity studies demonstrated high selectivity of IBI351 towards G12C. Subsequently, IBI351 effectively inhibits the downstream signal pathway to induce tumor cells’ apoptosis and cell cycle arrest. In September 2021, Innovent and GenFleet Therapeutics entered into an exclusive license agreement for the development and commercialization of IBI351 in China (including mainland China, Hong Kong, Macau and Taiwan) with additional option-in rights for global development and commercialization.

On November 13, 2022 Shanghai Stock Exchange listed company HitGen Inc. ("HitGen", SSE:688222.SH) reported that it has entered into a research collaboration agreement with DAEWOONG PHARMACEUTICAL Co., Ltd ("Daewoong"), a global healthcare group in the Republic of Korea, dedicated to improving the quality of patients’ lives (Press release, Daewoong Pharmaceutical, NOV 13, 2022, View Source [SID1234623904]). HitGen will apply its DNA-encoded library (DEL) technology platform centered around the design, synthesis and screening of thousands of DELs that collectively comprise over 1.2 trillion small, drug-like molecules to discover compounds that bind to certain targets that Daewoong needs to discover for new drug development.

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"It is truly a privilege to work with Daewoong, one of the top pharmas in Korea, comprising a team of very innovative and collaborative researchers. We look forward to initiating the collaboration to identify novel small molecule starting points from DNA-encoded libraries, and we believe that successful results would lead to further expanded collaborations," said Dr. Jin Li, Chairman of the Board and Chief Executive Officer of HitGen.

"We are pleased to collaborate with HitGen which has the world’s best DEL screening platform. Daewoong will strengthen its innovative drug development capabilities and improve the quality of life of patients through cooperation with HitGen," said Seng-ho Jeon, Chief Executive Officer of Daewoong.