BIOCEO15: Kite Pharma Debuts Near-Term Plans, Says It’s Tackling "Toxicity Issues"

BIOCEO15: BIOCEO15: Kite Pharma Debuts Near-Term Plans, Says It’s Tackling Toxicity Issues
February 9, 2015
By Riley McDermid, BioSpace.com Breaking News Sr. Editor

One of 2014’s hottest biotech IPOs, Kite Pharma, Inc. , is focusing now on rolling out its near-term plans to investors while simultaneously attempting to manage toxicities its encountered while treating cytokine release syndrome, Chief Executive Officer Arie Belldegrun told a panel in New York on Monday.

BIOCEO15: BIOCEO15: Kite Pharma Debuts Near-Term Plans, Says It’s Tackling Toxicity Issues

BIOCEO15: BIOCEO15: Kite Pharma Debuts Near-Term Plans, Says It’s Tackling Toxicity Issues


Belldegrun the comments as part of a panel at the 17th Annual BIO CEO and Investor Conference at the Waldorf-Astoria in New York City. Last year, BIO CEO, a well-known annual schmooze-fest for the biotech community, had more than 1,400 attendees from 26 different countries, with around 750 investors and around 1,820 partnering meetings scheduled, according to event organizers.

This year it looks to be even bigger, as investors flock to find out which early-stage companies are advancing the most interesting drugs and products into a biotech sector that saw the Nasdaq Biotech Index gaining 11.2 percent in the fourth quarter, adding to another solid total return of 34.4 percent in 2014.

As part of that push, Kite debuted both the design of two of its clinical studies and its plan for 2015 (see images). The news was greeted warmly by attendees, who have been clambering for information on Kite’s engineered autologous cell technology, and its T-cell receptor and chimeric antigen receptor platforms.

One of the trickier components has been working out the cytokine release syndrome toxicity, said Belldegrun. "It's a learning curve," he said.

Kite debuted slides showing a timeline for all clinical trials it will be starting, as well as its clinical manufacturing capacity. It announced it would roll out interim data from studies at American Society of Hematology's annual meeting beyond its current CD19 protein by year end.

Kite has been in the headlines lately for attempting to avoid the current pricing pitfalls being experienced by Gilead Sciences, Inc. , telling Reuters in an interview last month that while its experimental cancer drugs may cost at least $150,000 per case, it is already having conversations with insurers, despite the chief executive of Express Scripts Inc. vowing in January to take on cancer drug pricing next.

"We learn from mistakes," Belldegrun told Reuters at the J.P. Morgan Healthcare Conference, referring to the currently ongoing war between Gilead and massive benefits provider Express Scripts. Express Scripts started the price war between dueling hepatitis C drugs in October when it said it would change its standard formula to a new, cheaper AbbVie treatment instead of choosing Gilead Science’s pricey Harvoni or Sovaldi treatments.

Still, Kite may have a tough case to make. Kite Chief Financial Officer Cynthia Butitta has estimated that its immunotherapy cancer treatment (as yet unnamed) could start at $150,000, but analysts have put the average cost at nearly twice that—making it very unlikely payers like Express Scripts, who balked at a $94,000 price tag for near-cure hepatitis C drugs, will splash out anywhere close to that amount.

Nonetheless, Kite will attempt to dissuade insurers from judging the therapy on price alone. "We're starting that effort this year," Butitta said. But those negotiations could be complicated even further by the fact that Express Scripts Chief Executive George Paz told the audience of a panel at J.P. Morgan that what worked for bringing down prices for liver disease might also work to rein in the cost of cancer drugs.

"The big opportunity out there is really in cancer," Paz said. "If we can get out in front of that, that is a huge opportunity."

Paz also took aim at companies that charge sky-high rates for drugs that are essentially a cure, such as Gilead’s hepatitis drugs Harvoni and Sovaldi. Express Scripts has pointed out that many public health programs like Medicaid and state prison systems currently foot the bill for the $94,500 price tag of Sovaldi, which has a cure rate of around 90 percent.

"Everyone's got to make money, but how much?" said Paz. Kite also has a strategic research and licensing collaboration with Amgen worth an initial $60 million to develop and commercialize novel CAR-T cell immunotherapies based on Kite's engineered autologous cell therapy (eACT) platform.

CAR-T therapy has been a hot commodity for biotech investors for the last few quarters, an importance recognized by the deal size, which has Amgen putting in $60 million, as well as funding for research and development costs and an additional $525 million in milestone payments for Kite if the company sees the successful completion of regulatory and commercialization milestones. It also has built-in single- to double-digit royalties for sales and the license of Kite's intellectual property for CAR T cell products.

For its part, Amgen has said the terms of deal make it eligible to receive up to $525 million in milestone payments per Kite program, plus tiered single-digit sales royalties.

The deal will come as welcome news for Kite, who watched its primary competitor Juno Therapeutics rocket into the Wall Street stratosphere with a successful IPO that rose a whopping 60 percent at opening on Dec. 23 to $38 per share. Juno ’s CEO Hans Bishop took home $100 million for his 3 percent stake in the company—success Kite is likely to try to emulate as its pushes it immuno-oncology platform to Big Biotech firms.

CAR-T therapies have been hot for several quarters as companies look to find new ways to use the body’s immune system to attack cancer. The U.S. Food and Drug Administration has seen a flood of initial applications for the therapy though clinical trials have seen mixed results so far. That’s not stopping Kite executives from celebrating Monday, however.

"Amgen is an ideal partner for us, based on their strong presence in oncology and the company's broad array of cancer targets optimally suited for combining with our CAR technologies. We are proud to announce this unique collaboration and its validation of our R&D expertise, intellectual property position, and therapeutic manufacturing and processing capabilities," said Arie Belldegrun, Kite Pharma's president and chief executive officer, in a statement at the time. "We believe that the therapeutic candidates resulting from the collaboration will have the potential to dramatically transform CAR approaches and to become some of the most powerful therapies for the treatment of cancer."

Amgen, too, said the company was a good fit for its always-evolving cancer pipeline, which has doubled down on novel therapies in recent years in an attempt to compete with larger efforts from rivals like Merck (MRK)’s immunotherapy PD-1-blocking Keytruda. Amgen may attempt to pair Kite with its recently green-lit antibody Blincyto (blinatumomab), another immunotherapy that uses T-cells to fight cancer from within a patient’s own body.

"The intersection of immunology and oncology represents one of the most promising approaches to delivering significant impact for patients with cancer," said Sean Harper, executive vice president of research and development at Amgen. "With our existing immuno-oncology portfolio of cutting-edge technologies and expertise, we believe joining forces with Kite Pharma will leverage our targets and their leading CAR-T cell platform to advance another new promising therapeutic approach to fight cancer."


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