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Monday, March 28, 2016

What Celator's Success In AML Means For Actinium Pharma

Earlier in March 2016, Celator Pharmaceuticals (CPXX) announced positive top-line results from the company's Phase 3 clinical trial testing VYXEOS™ (cytarabine + daunorubicin liposome injection) in patients with high-risk (secondary) acute myeloid leukemia (AML) compared to the standard of care regimen of cytarabine and daunorubicin known as "7+3". The trial met its primary endpoint demonstrating a statistically significant improvement in overall survival (OS). Specifically, patients on VYXEOS had a median OS of 9.56 months compared to 5.95 months for the current 7+3 standard of care. The results were statistically significant (p=0.005) with a hazard ratio of 0.69, representing a 31% reduction in risk of death in favor of VYXEOS. Full data from the Celator Phase 3 trial will be presented at the American Society of Clinical Oncology 2016 Annual Meeting in June 2016.

Celator shares are up over 600%, from $1.50 to $11.00 per share on this very positive news. It is the perfect example of why investors put money into small-cap biotech stocks. The risks are high, but so are the rewards, and Celator shareholders hit one out of the park last week. I have not written before on Celator; however, I have written extensively on Actinium Pharmaceuticals (ATNM), another small-cap biotech company trading around $2.00 per share with two drug candidates under development for AML.

Since the Celator news, I've received several questions from investors on what exactly the VYXEOS data means for Actinium. Below I attempt to put the positive VYXEOS news in context as it relates to Actinium's Iomab-B and Actimab-A, and hopefully clear up some confusion with respect to the differing strategies of the two companies.

As It Relates To Actinium

Following the release of the Celator Phase 3 data, I received several questions from investors on how this effects Actinium, specifically with the development of Iomab-B and Actimab-A. One investor asked me if Celator's success narrows the market or limits the opportunity for Actinium. On the contrary, Celator's success is very good news for Actinium Pharma.

Actinium's most advanced product candidate is Iomab-B, a combination monoclonal antibody (BC8) that targets a leukocyte common antigen, CD45, and radioactive iodine-131, recently cleared to begin a Phase 3 clinical trial as a conditioning agent for patients ahead of BMT. Conditioning agents are chemotherapies or radiation therapies given to patients ahead of a BMT to wipe-out (ablate) bone marrow and provide immunosuppression to prevent rejection of the transplanted graft.

By specifically targeting CD45, a cell surface antigen widely expressed on hematopoietic (myeloid and lymphoid) cells, but not other tissues, Iomab-B can effectively offer target-specific ablation as a conditioning regimen prior to bone marrow transplantation with the potential for improved efficacy and safety / tolerability. And, because CD45 is expressed on both normal and leukemic cells, it can be used to target marrow in both remission and relapsed patients. But there is a catch to using Iomab-B; in order for patients to qualify for a BMT, they must be - above all other things - still alive.

In all seriousness, according to the U.S. National Cancer Institute (NCI), there were an estimated 20,800 new cases of AML in the U.S. in 2015. The five-year survival rate is estimated at only 25.9% (source: SEER). The more patients that respond to the induction phase of chemotherapy means the more patients that will enter the consolidation or maintenance phase. Based on the Celator Phase 3 data, patients on VYXEOS had a CR+CRi of 47.7% vs. 33.3% for 7+3. That is a 43% increase in the patient population making it to the consolidation or maintenance phase of treatment. And, patients on VYXEOS had a 1.5x and 2.5x chance at still being alive at the end of year one and year two, respectively.

We have not seen the relapse rate for the Celator Phase 3 data. However, I interpret the results as simply increasing the number of patients that will qualify for a BMT following their initial course of treatment. VYXEOS is not a cure for AML. While VYXEOS may very well result in longer survival and extended periods of remission, the median overall survival rate from the Phase 3 trial was still only 9.56 months. Half the patients are dying before 9.56 months and only 41.5% were still alive one year post-diagnosis. Only a BMT has the potential to cure the disease. This is why Celator's positive Phase 3 data is good news for Actinium. At the end of one year, almost 50% more patients with advanced, high-risk AML are still alive. That's an almost 50% bigger patient population for Iomab-B.

The Celator data really has no impact on the market opportunity for Actimab-A. Actimab-A is a next-generation monoclonal antibody, lintuzumab, which targets the myeloid progenitor cell protein CD33, linked to radioactive actinium-225 (Ac-225). Actinium is currently conducting a Phase 1/2 clinical trial (NCT01756677) with Actimab-A as a first-line treatment for AML patients over the age of 60 who are not eligible for standard 7+3 induction chemotherapy. This is because these patients have significant comorbidities that make standard induction intolerable to these patients. The trial is being conducted at five centers in the U.S., Memorial Sloan Kettering, Fred Hutchinson, Johns Hopkins, Baylor Cancer Center, and the University of Pennsylvania.

The important thing to understand about Actimab-A vs. VYXEOS is that the two drugs are going after two different market opportunities. If you can tolerate standard induction 7+3, then it seems a no-brainer to try VYXEOS instead. The patient gets a 31% reduction in risk of overall death and nearly a 50% improvement in chance of still being alive at the end of one year. However, if you have other significant diseases then an oncologist is going to be unlikely to induce with an anthracycline drug such as daunorubicin or idarubicin regardless of whether or not it is in a nano-particle liposomal formulation or not. These patients are contraindicated and simply cannot tolerate the drug in any form.

This is the market opportunity for Actimab-A. The improvement in outcome for patients that can tolerate standard induction will surely drive market share towards VYXEOS, but it does not make the market any bigger in terms of patients. VYXEOS will get a bigger slice of the "can tolerate" pie, but the pie is staying the same size and the "cannot tolerate" patients are in the same boat they were before VYXEOS came along.

Expanding The Market Opportunity

For Iomab-B: There are no currently approved treatment options for elderly patients with refractory AML. This is a patient population of approximately 15,000 individuals in the U.S. and EU each year, less than 20% of which are able to tolerate conditioning regimens that allow them to go onto BMT. At least, that is what I wrote before the Celator VYXEOS data. Given the improvement in overall survival demonstrated with VYXEOS, if Celator can capture 50% market share from 7+3, it is likely the number of eligible patients is now closer to 20,000 individuals between the U.S. and EU.

Actinium has received OrphanDrug designation in the U.S. and recently began the process to file for the same in the EU. I believe Iomab-B has two potential pathways to meaningful revenues here. The first is in the small subset of patients where the physicians believe reduced intensity conditioning may be tolerated but that Iomab-B may be more effective (~4,000 patients) and the second in which a regimen such as Iomab-B may be more tolerable and allow a physician to try BMT without undue risk of treatment-related mortality (~16,000) patients. Market share gains in both segments seem achievable, and at approximately $75,000 for a course of treatment (blended global price), Iomab-B targets a $1 billion peak opportunity.

For Actimab-A: The target market for Actimab-A really has not changed following the Celator Phase 3 data. Approximately two-thirds of the AML population is over the age of 60 years old and half of these patients are not eligible for the current standard of care (7+3 or VYXEOS) due to poor cytogenetics, overlapping toxicities with contaminant medications, or existing comorbidities.

In December 2014, Actimab-A was granted Orphan Drug status by the U.S. FDA. Data presented to date have been encouraging. I estimate the patient population in the U.S. is approximately 6,500 individuals. The opportunity in Europe is another 7,500. Assuming a cost of approximately $65,000 per treatment in the U.S. and Japan and $42,500 in the EU (management guidance), the peak opportunity for Actimab-A is at least $750 million.

Review Of AML And 7+3 Standard Of Care

Leukemias are cancers of the blood and involve bone marrow, circulating white blood cells, and organs such as the spleen and lymph nodes. The cancer usually manifests in the bone marrow and results in a high number of abnormal white blood cells called blasts (also called leukemia cells). The presence of these immature (not fully developed) blast cells can lead to a number of physiological symptoms such as bleeding, bruising, anemia, fatigue, and an increased risk of infection. The symptoms get worse as the number of blast cells increase and subsequently reduce the number of healthy normal blood cells through a crowding out effect.

Acute leukemia refers to malignancies that occur earlier in the differentiation and maturation process for hematopoietic stem cells (HSCs). HSCs are multipotent cells that give rise to common myeloid or common lymphoid progenitor cells that go on to form the specialized cells found in human blood. Malignancies that occur in immature myeloid progenitor cells are called Acute Myeloid Leukemias (AML). The symptoms for AML result from an increase in immature blast cells and reduced production of healthy normal specialized cells. More specifically, as the number of blasts increase, the number of specialized cells, including red blood cells, platelets, and white blood cells decrease, resulting in symptoms such as anemia, bleeding, and risk of infection.

Generally speaking, leukemia is treated with chemotherapy. The effects of systemic chemotherapy are most pronounced on rapidly dividing cells in the body, which makes treatment highly effective for acute diseases such as AML. The systemic chemotherapy is deployed in various stages, with the first stage known as the induction or "wipe out" phase, generally lasting between four to six weeks. The goal of the induction phase is to kill all the cancerous cells and put the patient into remission. This is accomplished through administration of high-dose chemotherapy. 

The most commonly used chemotherapy regimen for AML is cytarabine, given continuously for seven days through an intravenous line, and an anthracycline drug, such as daunorubicin or idarubicin, given in a single intravenous dose for the first three days of treatment. This is sometimes known as the "7+3" regimen. These drugs kill AML cells over the first 7 to 14 days; it then takes the normal bone marrow about 14 days to recover and produce (hopefully) normal blood cells again. 

Despite its widespread use, there has been minimal advance in 7+3 or focus on the interaction of the two drugs on a cellular level over the past several decades. For example, cytarabine is administered as a continuous intravenous infusion at 100 mg/m2 per day for seven days, whereas daunorubicin is given as a single intravenous infusion at 60 mg/m2 on days one, two, and three. In the current standard of care, free cytarabine and daunorubicin are administered without regard to their ratio dependent interaction. In fact, the drug-drug ratio is constantly changing and excess daunorubicin is likely antagonistic to the mechanism, potentially limiting the effectiveness of the combination treatment. Enzymatic inactivation and imbalanced drug efflux and transporter expression reduce drug levels in the cell. Decreased cytotoxicity leads to cell survival and the emergence of drug-resistant cells (source: Celator Pharma).

Celator Pharmaceuticals, through its proprietary CombiPlex technology platform, designed an optimized synergistic liposomal formulation of cytarabine and daunorubicin to maintain the optimal synergistic drug ratio for extended periods of time after intravenous injection, with the aim of improving anti-leukemia activity. Beyond the convenience of a fixed dose and shorter treatment regimen (100 u/m2 on days one, three, and five), the goal with VYXEOS is to provide prolonged overall survival and potentially increase the number of patients that make it to the next phase of AML treatment, known as the consolidation phase.

Consolidation helps prevent the spread of remaining cancerous cells to other organs, including the brain. Consolidation phase chemotherapy includes additional rounds of high-dose cytarabine (HiDAC), with the goal of maintaining a prolonged period of remission. For patients in remission with a high risk of relapse or who are refractory to HiDAC, allogeneic hematopoietic stem cell transplantation (HSCT) remains the only option. HSCT, or the simpler term of bone marrow transplant (BMT), does provide a potential for a curative treatment for AML. The key, however, is to get patients to this phase, as many die during induction or consolidation before a BMT is even plausible. This will be important for when we talk about Actinium below.


Celator enrolled a total of 309 patients between the ages of 60 and 75 with pathologically confirmed high-risk AML for their Phase 3 trial. As noted above, the trial (NCT01696084) met its primary endpoint demonstrating a statistically significant improvement in overall survival (OS) for patients taking VYXEOS vs. 7+3 standard of care chemotherapy. Specifically, patients on VYXEOS had a median OS of 9.56 months compared to 5.95 months for 7+3. The results were statistically significant (p=0.005) with a hazard ratio of 0.69, representing a 31% reduction in risk of death in favor of VYXEOS.

Importantly, 41.5% of VYXEOS patients were alive at one year vs. 27.6% for 7+3. At the end of year two, 31.1% of VYXEOS patients were still alive compared to only 12.3% for 7+3. VYXEOS also demonstrated a statistically significant improvement in induction response rate (CR+CRi of 47.7% versus 33.3%; p=0.016) and this significance was maintained for the analysis of CR alone (CR of 37.3% versus 25.6%, p=0.040). Sixty-day all-cause mortality was 13.7% versus 21.2%, in favor of patients treated with VYXEOS.

The results of the Celator Phase 3 trial are impressive. In the simplest terms, elderly patients with high-risk, previously untreated AML live longer and have better outcomes on VYXEOS compared to the current standard of care. That should result in more patients making it to the consolidation or maintenance phase of treatment, and potentially more patients qualifying for BMT curative therapy. This is a very good thing; congrats to Celator and their shareholders.


Biotech investors often view clinical data as a zero-sum game, but rarely is the utility so evenly balanced when it comes to treating orphan diseases with limited curative options. Yes, Celator released some impressive data in advanced high-risk AML last week. VYXEOS will keep patients alive longer, potentially allowing more people to pursue a cure for their AML through a BMT. In that sense, the pie did get larger for Actinium and Iomab-B. With respect to Actimab-A, VYXEOS is simply going after a different patient population. As I explained earlier in the year with respect to Actimab-A vs. CAR-T therapies, not all leukemias are the same, not all patient are the same, and not all treatment options are going to work for each subset.

I've edited the following AML treatment algorithm below to show where drugs like VYXEOS, Iomab-B, and Actimab-A may fall in line with various different patient populations.

Beyond the patient subsets by age or disease progression, there is significant cytogenic variation among AML patients that make various subsets respond and not respond to standard induction. I think Actinium has the potential to be the next Celator, and I'm keeping a keen eye on the story in 2016. 


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