Suitors Take Note as Bay Area's Nektar May Be Up for Sale

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Nektar Therapeutics, based in San Francisco, is reportedly exploring various strategic options, including a possible sale, partnerships or licensing agreements.

The company has several pipeline products for cancer, auto-immune diseases and chronic pain. One of its key products is NKTR-214, an immuno-oncology product that was discovered and wholly owned by Nektar, and being investigated in combination with Bristol-Myers Squibb’s Opdivo (nivolumab) as a collaboration, and unpartnered with Merck’s Keytruda (pembrolizumab). It is also being evaluated as a solo therapeutic.

NKTR-214 is an IL-2 that binds to the CD122 receptor on the surface of CD-8 and CD-4 positive immune cells. The company also has a late-stage trial for NKTR-181 for pain, and several other products.

John Carroll, with Endpoints News, writes, “It hasn’t all been a bed of roses for Nektar over the past year. The biotech attempted to win an accelerated European OK for its cancer drug Onzeald (NKTR-102), but ran straight into a regulatory brick wall. The CHMP voted thumbs down on Onzeald, which was also bad news for Daiichi Sankyo, which bet $20 million upfront on a regional licensing pact for the drug. Daiichi recently signaled that it wanted to bail on the deal.”

The company’s stock has more than tripled in value since early November, largely based on results for NKTR-214. Shares are currently trading at $88. The 52-week high was $99.02 and the 52-week low was $12.50. Nektar has a market cap of $13.857 billion.

The company’s value, and the high-risk aspects of its pipeline, might make buyers uneasy, making licensing or partnership deals more likely.

Bloomberg writes, “A Nektar sale would add to a $25 billion burst of biotechnology and drug deals since Jan. 1, with extra cash from the U.S. tax law passed last year seen as fueling a continuing boom. The tax law should unlock about $160 billion in overseas cash for big drugmakers to spend on takeovers, Goldman Sachs Group Inc. analyst Salveen Richter has estimated.”

Those deals include Sanofi’s acquisition of Bioverativ for $11.6 billion and Ablynx for $4.6 billion, and Celgene’s acquisition of Juno Therapeutics for $9 billion.

Brad Loncar, founder of Loncar Investments and the Loncar Cancer Immunotherapy Index, told Bloomberg, “Owning NKTR-214 could either put an acquirer in a league of their own or blow up in their face, because all the excitement surrounding this drug is based on very little patient data, as intriguing as it is.”

On Nov. 11, 2017, the company released the first interim data of PIVOT-02 Phase I/II trial of NKTR-214 with Opdivo in several tumor types. Opdivo is a PD-1 immune checkpoint inhibitor. “In the dose-escalation stage of the PIVOT trial, we’ve observed important response rates across all three tumor types—melanoma, renal cell carcinoma and non-small lung cancer—in both PD-L1 positive and PD-L1 negative patients,” said Mary Tagliaferri, Nektar’s senior vice president of Clinical Development, in a statement. “All patients with responses in the trial continue on treatment. Of note, we observed responses in three of four Stage IV non-small cell lung cancer patients whose tumors did not express PD-L1 and who had progressed on prior chemotherapy, including one patient who experienced a complete response. In the combination treatment, there were no Grade 3 or higher immune-mediated adverse events at the recommended Phase II dose or below. Nektar and Bristol are now actively enrolling patients in the Phase II expansion part of the PIVOT study in five different tumor types.”

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