Nuevolution - RORing possibilities

2016-09-13 17:10, Edited at: 2016-09-13 17:19

ROR gamma antagonist(inverse agonist)global pipeline There is a significant unmet medical need for oral (small molecule) drugs that are safe and effective in the treatment autoimmune diseases such as Multiple Sclerosis (MS), Rheumatoid Arthritis (RA), Inflammatory Colitis, Psoriasis, COPD, Asthma etc. NUEVOLUTION is very well positioned for this huge market. Tonight September 13, 2016 Nuevolution will be presenting at the annual Rodman&Renshaw Global Investment conference in New York.

Autoimmune diseases is a body’s hyperactive immune response against the substances and tissues normally present in the body. Autoimmune diseases are more commonly caused by genetic, infectious or environmental factors. The prevalence of autoimmune disease is on rise. According to National Institute of Health, approximately 50 million of Americans suffer from autoimmune diseases. The diseases in estimated to be one of the top 10 cause of death in women under the age 65, and is the second highest cause of chronic illness. There are more than 80 clinically different type of autoimmune diseases identified till date. With rising prevalence of autoimmune diseases the demand of drugs used in the treatment for autoimmune disease is also rising. (Future Market Insight)

According to the latest market research report by Technavio, the global autoimmune drugs market is expected to reach USD 80 billion in revenue by 2020.

In autoimmune disorders, targeted AntiTNFa medications have been effective at throttling back the body’s immune response to reduce symptoms, but that has tended to come at the cost of increased risk of infections. For example, one of the most widely used drugs in this space is the biological Humira, and its label includes a black box warning about risks for opportunistic infections. In summary Anti-TNFαand other biologic approaches to the treatment of autoimmune disease are limited by significant side effects and cost, hence oral small molecule drugs are much needed.

The Retinoic acid-related Orphan nuclear Receptor gamma (ROR-gamma) is a very hot target in the pharmaceutical industry, but also known to be a difficult-to-drug target. This receptor has been shown to convert a type of immune cell called CD-4+ T cells into T helper 17 cells, which produce the inflammatory cytokine interleukin 17 (IL-17). Excessive activity in the ROR-gamma receptor has been implicated in autoimmune conditions. ROR-gamma inhibition provides an opportunity to restore normal Th17/Treg balance & achieve selectivity autoimmune disease treatment

The “holy grail” in this therapeutic area is to identify a therapeutic agent that will control the activity of those Th17 cells and innate lymphoid cells that are responsible for the disease, while at the same time retaining the desirable responses driven by other T cells (Th1), which are needed for clearance of infections, particularly those of viral origin. The pathway seems better to use than TNFa in some autoimmune diseases.

Only two candidates are in the clinic but interest from Astra, Johnson & Johnson, Merck & Co, Sanofi and Pfizer suggest more may be coming. The hope is to create a molecule that can more directly target inflammatory response in autoimmune diseases.

It is projected that technology companies with expertise in discovery of new small molecule drugs targeting ROR-gamma with new antagonists (inhibitors) are preferred partners of Big Pharma.

ACTIVITY LAST YEARS

Big Pharma agreements (in chronological order)

Exelexis (US) - Bristol Meyer Squibb 2010 Shelved 2013

Karo Pharma (SWE) - Pfizer 2011
Pfizer took over 2014 - since then no news - dead?

Lycera (US) -Merck 2011/13 agreements Discovery/Pre-clinical
Rights appear to have been returned to Lycera

Phenex Pharma (GER) - Jansen (J&J) 2012
Early discovery/pre-clinical phase in Dec 15

Orca Pharma (UK) / AstraZeneca - 2015
Early Discovery/Pre clinical - no news

Lead Pharma (NTL) - Sanofi - 2015
Preclinical/lead optimisation in 2016 - Milestone payment in Nov -15

Brickell Biotech (UK) /Orca Pharma (UK) Nov 15
Only Bbi-6000 dermatology
Pre-clinical - no news

No Big Pharma Agreement yet

Japan Tobacco - stopped after Phase 1 in 2015

Arrien Pharma (US) - Started Phase 1 in May 16

Vitae (US) -listed Nasdaq New York
New phase 2 in 2017 - some liver tox in high dosing in previous interrupted phase 2 early 2016

Nuevolution (SWE/DK) listed Nasdaq- Stockholm
Very good late pre-clinical data - preparing for IND/Phase 1 mid 2017 – GLP-tox left. Good safety in non-GLP studies.

Innovimune (US)
INV-17 in pre-clinical stage Mouse models - MS/Ra/Lupus - No news since mid 2015 - status?

Krish Biotech (IND) KBRPL1001- preclinical - no news

VALUE OF BIG PHARMA DEALS OVER THE LAST YEARS

Exelexis & BMS 2010 / Discovery at agreement/320 musd for ROR

KaroPharma & Pfizer 2011
Discovery at agreement
200 musd

Lycera & Merck 2011 and 2013
Early Discovery/pre-clinical at agreement
Appears to be 300+300 musd in research and commercial milestones (RORgamma+other)

LeadPharma & Sanofi 2015
Discovery at agreement
No financials disclosed

PhenexPharma & Jansen (J&J) 2012
Discovery at agreement
135 musd plus commercial milestones

Orca Pharm & AstraZeneca 2015
Discovery at agreement
123 musd

During the last years Big Pharma has been willing to agree on bio deals on large amounts as per above. All these deals have primarily been in the discovery phase. Furthermore very few positive news have been seen from these agreements, likely proving the difficulty to drug the ROR target.

Nuevolution is at the end of the pre-clinical phase in the IND prep phase. GLP-tox left. It is thus very logical to assume that a deal for Nuevolution could be much better than above deals.

Note that the RORgamma antagonist target is important to over 80 autoimmune diseases, i.e it is a huge pharmaceutical market that is targeted.

CONCLUSIONS

In this very hot and attractive area, the global positions appear to be the following:

-The Big Pharma agreements seem to be either, shelved/stopped or in early discovery/pre-clinical phase. The target is known to be difficult to find adequate substances for and nothing has appeared in the clinical setting.

- In respect of the ones without Big Pharma agreement yet a subjective rating of position based on development stage AND publicly available info seem to be;

1. Arrien Pharmaceutical (Private) - Phase 1

2. Nuevolution (Nasdaq – Stockholm)- two compounds in preparatory IND/Phase 1 stage – GLP-tox this fall/winter.

3. Vitae (Nasdaq –NYC)- phase 2 – tox in previous interrupted Phase 2

My conclusion is that Nuevolution is the most likely to find the necessary balance between good efficacy, good PK properties and good safety. If so, the Nuevolution share price will be RORing !! and that is apart from all other nteresting projects in Nuevolution. (see my Redeye community analysis Aug 30, 2016)

I'm building my position in Nuevolution.