Bavarian Nordic Plummets 49% After Cancer Vaccine Flunks Late-Stage Test

Bavarian Nordic Plummets 49% After Cancer Vaccine Flunks Late-Stage Test September 15, 2017
By Alex Keown, Breaking News Staff

COPENHAGEN, Denmark – Shares of Bavarian Nordic A/S are down more than 49 percent this morning following the failure of its late-stage prostate cancer drug, Prostvac.

Not only did the drug fall below expectations in the Prospect trial, the independent data monitoring committee said continuation of the drug is “futile” following an interim analysis of the Phase III trial, the company said in a statement. The company did not elaborate on the failures noticed by the monitoring committee. The objective of the study was to determine whether PROSTVAC alone or in combination with GM-CSF could prolong overall survival in men with asymptomatic or minimally symptomatic mCRPC.

Investors agreed and dumped the stock following the Thursday announcement by the company. Shares of Bavarian Nordic closed at 442 Krone, about $71.08. This morning though shares traded as low as 187 Krone, about $30.07. As of 4:21 GMT shares were trading at 230 Krone, or about $36.99.

Bavarian Nordic Chief Executive Officer Paul Chaplin said the company was extremely disappointed in the interim analysis. Prostvac was being developed as a monotherapy for patients with metastatic castration-resistant prostate cancer (mCRPC).

“While this is certainly not the desired outcome, we remain steadfast believers in the power of combination treatments, including immunotherapies, to transform the future of cancer therapies,” Chaplin said in a statement.

In 2015, Bristol-Myers Squibb forged an agreementwith Bavarian Nordic to develop and market Prostvac. The two companies signed a deal worth up to $1 billion, with BMS providing Bavarian Nordic $60 million in upfront cash. BMS has been using Prostvac in combination studies for various indications in cancer, including lung cancer. In April, the two companies initiated a Phase II trial combining Prostvac with BMS’s Yervoy (ipilimumab) or Opdivo (nivolumab) for the treatment of pre-surgery prostate cancer. Bavarian Nordic said the failure is not likely to affect the company’s 2017 financial results.

Prostvac (rilimogene) is a prostate specific antigen (PSA)-targeted immunotherapy candidate designed to enhance or stimulate the body's immune response, specifically T cells. Through a stimulation of the immune system the body will then be able to fight off the cancer cells. Prostvac was being developed in collaboration with the U.S. National Cancer Institute under a Cooperative Research and Development Agreement.

The failure of Prostvac could have greater implications though, which has also lead to negative investor reaction. Jefferies analyst Peter Welford said in a note that Prostvac’s failure could read through to other Bavarian Nordic programs, including its bladder cancer drug, which has some similarities to Prostvac. If that’s the case, Endpoints News’ John Carroll said potential revenue from that drug “went poof.”

Chaplin though told Reuters he did not agree with the Jefferies analyst.

"As I sit here today, no. But of course we need to see the data from the Prostvac study and we need to do a deep dive and make an assessment and learn lessons from it," Chaplin told Reuters.

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