Welcome to your deal review for the month of August. As would be expected at the end of the summer news flow was modest, but Northwest Biotherapeutics kept things alive with a $17.5 million financing via convertible debt, while Gamida Cell announced a game-changing deal with a large Pharma partner that is placing its bets in cell therapy technologies. Read on to find out more.
Northwest Biotherapeutics (NWBO), a cell therapy company based in Maryland, successfully completed a $17.5 million convertible debt financing. The notes, which can be converted at a price of $7.30 U.S. per share (10 percent premium to market when the deal was priced), bear 5 percent interest for investors. The use of proceeds will go towards furthering the development of the company’s dendritic cell (DC)-based vaccination platform (DCVax®) being investigated for challenging cancers.
Similar to NeoStem’s (NBS) tumour cell-specific DC therapy, which recently inked a deal with Cellular Biomedicine Group in China to advance its immunotherapy through Phase 2 studies, NWBO’s technology is patient-specific. In cases where the malignancy can be excised, tumour cells are isolated and pulsed with a patient’s own dendritic cells (collected through apheresis of peripheral blood). Once activated, the dendritic cells are administered back to the patient intravenously where they act to elicit a targeted attack on cancer cells by the patient’s immune system.
Though expensive, the approach may trump other targeted immunotherapy approaches in the clinic (antibodies, T cells directed at a single antigen), because the interaction between cancer cell and dendritic cell during preparation of the therapy primes the dendritic cell to target not just a single protein, but a broad protein expression profile on the surface of the cancer cell. As the identity of a cancer cell changes through disease progression, these therapies increase the temporal span in which they can exert their effect by casting a wider “therapeutic net”.
NWBO’s most advanced clinical program is targeting the malicious and notoriously difficult glioblastoma multiforme, a type of brain cancer with a median time of survival from diagnosis of only three months, and 0 percent historical survival rate for patients with the most advanced forms of the disease (class V and class VI).
Companies developing patient-specific cell therapies face considerable logistical and border issues in the distribution of their products. The monies raised in this recent financing will support NWBO’s manufacturing operation housed in Germany. The company has worked aggressively over the last few years to establish a cross-border distribution networkwithin Europe for the delivery of its DCVax® technology for the treatment of brain cancer. NWBO has partnered with Kings College London in the UK, where it has additional manufacturing capacity.
Isreal-based Gamida Cell announced a deal with Novartis (NVS), which will invest $35 million U.S. in the company for 15 percent equity and an option to buy it outright. The Swiss giant has recently made forays into the cell therapy space, including its collaboration last year with Kentucky-based Regenerex, a private biotech developing a hematopoietic stem cell (HSC)-based platform being investigated to temper immune rejection following allogeneic transplantation.
The deal is centred on the performance of Gamida Cell’s NiCord® technology, a product composed of cord blood-derived HSCs expanded with nicotinamide. Contingent on the successful achievement of milestones, Novartis will provide cash payments of ~$165 million U.S. to existing shareholders, and up to an additional $435 million U.S. based on regulatory milestones.
Interestingly, Novartis is also in the race to get expanded HSCs to market. It is currently planning a Phase I/II study to investigate the small molecule SR1 as an agent to expand CD34+ cells. The company is a little behind Gamida Cell in clinical development, which has a Phase I/II ongoing. Both companies boast promising data. SR1 and NiCord® can expand CD34+ cells by 248-fold and 80-fold, respectively. However, the metric of greatest interest is not just expansion, but expansion of the correct CD34+ subtype. The technology that reigns supreme in this market will be that which expands a very rare subset of HSCs that carry long-term repopulating capability. Novartis’ investment in Gamida Cell is clearly strategic, and it could be a move to remove NiCord® from play if its clinical efficacy data is competitive to SR1.