Written by Shailesh Maingi, CEO & Founder, Kineticos

Recently, Kite Pharma and Roche Holding AG announced a collaboration1 to combine two promising immuno-oncology approaches to treat cancer, chimeric antigen receptor T cells (CAR-T) therapy, and check point inhibitors. The new therapy will combine Roche’s atezolizumab with Kite’s KTE-C19 therapy for patients with refractory, aggressive non-Hodgkin lymphoma (NHL).

The scientific rationale for combining the two therapies hinges on the thesis that atezolizumab may prolong the effectiveness of Kite’s KTE-C19 thus improving patient outcomes.

There are a few interesting elements about this collaboration; before we dive into the analysis, here is an overview of the science behind the alliance.

Chimeric Antigen Receptor T Cell (CAR-T)

Our immune systems are terrific at recognizing foreign intruders, but not as good at identifying cancer cells. One difference between ordinary and cancer cells is that latter expresses unique proteins called tumor associated antigens (TAAs) on their cell membranes.

TAAs can vary by tumor type, disease progression, and patient specific variables. CAR-T therapy exploits these molecular differences to target tumors.

In CAR-T, a patient’s blood is collected and the killer T cells are harvested. Chimeric Antigen Receptors (CAR) which match the patient’s tumor, are then engineered. Next, the CAR is bound to the patient’s own previously harvested T cells. These engineered CAR-T cells are then scaled in a laboratory. Finally, the modified T cells are infused back into the patient.

Since CAR-T therapy is specific to a patient’s tumor, off-target toxicity is reduced, and efficacy is increased2. The early results for Kite and other CAR-T companies have been promising. In mid 2014, Kite announced that 12 of the 13 evaluable patients had partial or complete remissions in a Phase 1/2 study for KTE-C19 for advanced B-Cell malignancies.

Kite’s KTE-C19 program targets CD-193, a protein expressed on the surface of B cell lymphomas and leukemias. Kite is actively conducting clinical trials for the following indications: diffuse large B-cell lymphoma, primary mediastinal B-cell lymphoma, transformed follicular lymphoma, adult and pediatric acute lymphoblastic leukemia, chronic lymphocytic leukemia, follicular lymphoma.

Check Point Inhibitors

Another popular approach in immuno-oncology approach revolves around check point inhibitors. The PD-1 (Program Death 1) receptor on T cells and the PD-L1 (Program Death Ligand 1) protein on cell membranes are part of a well regulated pathway to manage cell growth and death.

The PD-1 receptor on T cells acts as off switch. When cells want to inhibit immune response, they express PD-L1. The PD-L1 binds to the PD-1 on T cells. This lets the T cells know that cell expressing PD-L1 is not foreign to the body- think of this as a secret handshake between cells and our immune systems.

Cancer cells grow uncontrollably in part because they hijack the PD-1/PD-L1 pathway. Cancer cells over express PD-L1. This inhibits immune response which allows the cancer cell to evade attack by the body’s immune system.

So if there were a way to bind a cancer cell’s PD-L1, the T cell “off switch” would not be activated, and the T cell would recognize the cancer cells as foreign intruders and attack them. This is exactly what Roche’s drug atezolizumab does.

Atezolizumab is a monoclonal antibody (MAb) which binds to the PDL-L1 from tumor cells. Once the PD-L1 is bound, T cells recognize and kill the cancer cells. Roche currently has 55 open studies for studying atezolizumab for the treatment of various indications including melanoma, breast cancer, non-small cell lung carcinoma, bladder cancer, and renal cell carcinoma.

Kite and Roche Collaboration

There are a few things that are very interesting to me about this transaction.

Normally in transactions involving large pharma and a small biotech, the larger biotech contributes upfront cash, provides financial incentives for achieving clinical milestones and outlines royalties based on product sales.4 The Kite/Roche collaboration appears to be different.

The financial terms for this transaction were not disclosed, so it’s not clear how much, if any, money Kite received. As a publicly traded company, Kite must disclose all material information, and since the upfront cash details were not disclosed, we can infer that Kite likely did not receive significant cash from Roche.

What does this mean? For one, Kite is signaling to us that it has an adequate source of funding for this clinical program. For another, Kite is demonstrating its confidence in its technology by trading the short term (immediate funding) for the long term (marketing rights).

The driving force for this collaboration appears to technology sharing. Both Kite and Roche have developed impressive intellectual property in their respective fields. By combining their efforts, Kite and Roche can maximize their investment potential and minimize risk.

Even though the CAR-T and check point inhibitors are powerful techniques, clinical trials have a 90% failure rate. This collaboration gives Kite and Roche more chances for success with minimal incremental costs.

The structure of this collaboration leads us to the conclusion that this is an alliance between equal partners. Note that Kite will be leading the Phase 1/2 trials to begin later this year. Usually, big pharma prefers to take control of clinical programs, much to the chagrin of their smaller brethren5.

But CAR-T is different which gives Kite a great deal of leverage. Clinical research including patient recruitment, selection, dosing and monitoring is more complex. The CAR-T autologous manufacturing process is more involved than the typical drug manufacturing as well. Lastly, this approach requires very specific therapeutic expertise which Kite possesses.

Roche and Kite did not disclose the commercialization plan for this therapy. One option is that Kite would get co-marketing rights in the US while Roche gets Europe and ROW. Kite would likely lead all manufacturing efforts.

However, it is just as likely that Kite and Roche deferred some of these decisions. No CAR-T therapies have been approved so there a lot of unknowns about clinical expenses, manufacturing know, regulatory pathway, and reimbursement.

Will this collaboration yield improved outcomes for patients? What new combination therapies will we see? What will be the new model for emerging biopharma to collaborate with established pharma giants? We won’t know the answers for some time but this will be an intriguing area to monitor.


1 Last year, Juno and AstraZeneca announced a similar agreement. In some ways, this is catch up for both Roche and Kite.

2 At least this is the theory. There are a number of potential barriers to adoption including therapy costs and side effects such as cytokine storm.

3 For B Cell lymphomas and leukemias, CD20, CD274 and CD279 are some other common targets.

4 The Celgene/Juno transaction provides a counterpoint to the Kite/Roche deal. Celgene paid Juno $1b upfront, bought Juno’s stock and gained a seat on Juno’s Board to co-develop and co-market new CAR-T therapies. Just this week, Celgene and Juno doubled down on their initial collaboration.

5 There are three reasons for this primarily: they provide the funding, usually has a deeper understanding of the science, greater operational scale and can demand lower costs from their outsourcing partners.


    

Shailesh Maingi is the Founder and CEO of Kineticos and has a passion for the role R&D plays in improving healthcare outcomes.  Mr. Maingi is also an adjunct professor at the Kenan Flagler School of Business at the University of North Carolina and serves on the board of directors for a number of biopharmaceutical, diagnostic and contract manufacturing companies.

 Contact Shailesh

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