Clovis Oncology Raising $275 Million to Develop Cancer Drug Pipeline
Published: Jul 09, 2015
July 7, 2015
By Alex Keown and Riley McDermid, BioSpace.com Breaking News Staff
BOULDER, Colo.-- Clovis Oncology will sell $275 million in stock to raise funds for cancer drug research and the potential commercialization of its two lead cancer drugs rociletinib and rucaparib, if the drugs are approved by regulatory agencies in the United States and Europe.
Clovis’ stock was down nearly 4 percent this morning, trading at $82.52 per share.
Rociletinib is an oral drug used for the treatment of non-small cell lung cancer and rucaparib is an oral drug used for the treatment of ovarian cancer. Both drugs are in Phase II and Phase III of clinical trials, respectively. Both drugs received a Breakthrough Therapy designation from the U.S. Food and Drug Administration (FDA).
Earlier this month Boulder, Colo.-based Clovis submitted a rolling New Drug Application to the U.S. Food and Drug Administration (FDA) this month, as well as a Marketing Authorization Application to the European Medicines Agency (EMA) at the end of July.. The company said it plans to complete the NDA by the end of July.
“The initiation of this rolling submission represents a very important first step toward our biggest milestone of 2015 – the submission of our first NDA for rociletinib as treatment for patients with T790M-positive EGFR-mutant non-small cell lung cancer,” Patrick J. Mahaffy, president and chief executive officer of Clovis Oncology, said in a statement.
During the annual meeting of the American Society of Clinical Oncology (ASCO) in Chicago earlier this month Clovis revealed clinical study results that showed rucaparib shrank ovarian cancer tumors in 82 percent of the women it treated in a recent mid-stage trial. All of the patients treated with Clovis' rucaparib during the Phase II ARIEL2 had a mutated BRCA gene and 10 percent of patients had complete resolution of their tumors. Median progression-free survival was 9.4 months. In addition, nearly half of those (45 percent) with "BRCA-like" saw response rates to rucaparib, with their median progression-free survival in these patients was 7.1 months.
The successes of its two drugs have fueled rumors that Clovis could be ripe for a takeover from a larger pharmaceutical company, especially with both drugs having received breakthrough status by the FDA.
Last year Clovis inked a deal with GlaxoSmithKline on a new Phase I/II trial of an experimental oral combination therapy targeting mutant epidermal growth factor receptor (EGFR) in non-small cell lung cancer.
Clovis’ trametinib has been approved by the U.S. Food and Drug Administration as a single agent for the treatment of patients with unresectable or metastatic melanoma with BRAF V600E or V600K mutations.
J. P. Morgan Securities LLC is acting a representative of the underwriters for the offering. Credit Suisse Securities (USA) LLC is also acting as a joint book-runner, and Stifel and Mizuho Securities are acting as co-managers for the offering, Clovis said in a statement. In addition, Clovis Oncology intends to grant the underwriters a 30-day option to purchase up to an additional 15 percent of the number of shares sold on the same terms and conditions.
Clovis’ stock sales comes less than a month after Andrew Allen announced he was stepping down from his role as chief medical officer at the company to launch his own immuno-oncology biotech company. Allen will remain at Clovis through the end of the summer.
The ASCO news was helpful for Clovis because it offset a later, disappointing announcement that showed lackluster results for its non-small cell lung cancer rociletinib—and set up a war with much large competitor AstraZeneca PLC , who presented its own stunning lung cancer drug results yesterday.
“With these data presented at ASCO, we believe rucaparib has clearly emerged as a unique and best-in-class PARP inhibitor," said Patrick J. Mahaffy, president and chief executive of Clovis Oncology in a statement.
"In addition, with our now clinically proven BRCA-like clinical assay, we have validated our commitment to develop rucaparib not only for the 25 percent of women with germline and somatic BRCA mutations, but for the additional approximately 35 percent of women with the prospectively identified BRCA-like signature,” he said. “With the ARIEL2 extension enrolling rapidly, we look forward to submitting our NDA for rucaparib for the treatment of advanced ovarian cancer next year."
Rumors that Clovis could soon exit to a larger suitor have been swirling for months now, but this week’s ASCO data is likely to rejuvenate them. The company is in a better position now to entertain potential suitors than it was in 2013, after a Goldman, Sachs & Co. analyst, Terence Flynn, said in a note in late April that there’s at least a 30 percent chance the $2.9 billion Clovis will be acquired.
Now, with both of Clovis’ lung and ovarian cancer therapies receiving breakthrough status by the U.S. Food and Drug Administration (FDA), it’s only a matter of time before larger companies come calling.
“It’s fairly noteworthy that a small biotech gets breakthrough designation on two of their products,” Jon Loth, a money manager for Nuveen Asset Management’s Small Cap Growth Opportunities fund, told Bloomberg in April.
Also of note? Big partnership deals inked by Clovis in the intervening two years. Biotech giant GlaxoSmithKline said in November it will partner with the scrappy Clovis on a new Phase I/II trial of an experimental oral combination therapy targeting mutant epidermal growth factor receptor (EGFR) in non-small cell lung cancer.
The trial to test the combo of rociletinib and trametinib is planned for the first half of 2015. It will primarily test the safety and activity of the combination in patients with EGFR mutant NSCLC who were previously treated with an EGFR tyrosine kinase inhibitor (TKI).
“We have seen significant activity in EGFR mutant NSCLC patients treated with rociletinib monotherapy, and so an important next step in our research is to examine rociletinib in combination with other targeted therapies that may also impact acquired resistance to EGFR inhibitors,” said Lecia Sequist, the lead investigator for the study and medical doctor at Massachusetts General Hospital Cancer Center and associate professor of Medicine at Harvard Medical School.
As New Jersey Biotech Booms, Will It Overtake Other States As Prime Location?
A week after Celgene Corporation announced it is officially the mystery buyer of Merck & Co. ’s former 1 million-square-foot R&D site in Summit, N.J., it quickly became our most popular story last week.
The company announced last Wednesday that it is buying the space, ending months of speculation about what Big Pharma company might move into the neighborhood.
The Summit, N.J. site is zoned research/office. The New Jersey site would put operations closer to some of the major biotech and pharmaceutical hubs on the East Coast.
But, by far, the most tempting part of doing business in the state remains New Jersey’s operating tax credit, which allows companies to sell their net operating losses to the New Jersey Treasury. One of the state’s most recognizable biotechs, Celgene, used the program until it became profitable, which was key to it staying in the state, said local officials.
That has BioSpace is wondering if New Jersey is becoming the new face of biotech. What do you think? Can the Garden State compete with other longtime stalwarts like California or Boston?