Nektar Therapeutics (NKTR) announced that it has signed two deals to advance BEMPEG combos — one with Merck (MRK) and the other with SFJ Pharmaceuticals, explains John McCamant, biotech expert and editor of The Medical Technology Stock Letter.
The first is a Phase II/III trial of BEMPEG in combination with Merck’s KEYTRUDA for first-line treatment of patients with metastatic or un-resectable recurrent squamous cell carcinoma of the head and neck (SCCHN) whose tumors express PD-L1 (Combined Positive Score [CPS] ≥1).
The trial is planned to start in H2:21. The bottom line is our confidence is growing in the potential for BEMPEG combos as the Merck and SFJ deals represent significant third validations for NKTR.
Under the terms of the agreement, NKTR will conduct the Phase II/III trial, enrolling 500 patients with metastatic or recurrent SCCHN with PD-L1 expressing tumors.
Patients will be randomized to receive either the combination of BEMPEG plus pembrolizumab or pembrolizumab alone. The Phase II portion of the trial will include an interim analysis of overall response rate (ORR) after the first 200 patients enrolled have a minimum follow up of 4 months.
If the ORR passes a pre-specified futility boundary, the study will continue, and the remaining 300 patients will be enrolled to the Phase III portion of the trial. The primary endpoints of the trial are ORR and overall survival (OS); progression free survival (PFS) is a secondary endpoint.
NKTR has also announced a co-development collaboration with SFJ Pharmaceuticals to support the development of BEMPEG combos.
This was included a strong financial component and commitment from SFJ Pharmaceuticals, which is a global drug development company backed by heavyweights Abingworth and Blackstone Life Sciences. NKTR will serve as the sponsor of the Phase II/III trial.
The collaboration between SFJ and NKTR will support a new Phase II/III registrational clinical trial of BEMPEG plus pembrolizumab in patients with head and neck cancer whose tumors express PD-L1 (Combined Positive Score [CPS] ≥1).
Under the terms of the agreement, SFJ has agreed to fund up to $150 million to support the study and manage clinical trial operations.
In return, Nektar agrees to pay SFJ success-based annual milestone payments over a period of seven to eight years, which are contingent upon receipt of certain U.S. regulatory approvals for specified indications for BEMPEG and will begin following completion of the head and neck study that is projected to be in 2024.
If BEMPEG does not receive regulatory approval for one or more of the specified indications, NKTR will not owe any future payments linked to an indication that is not approved.
Both of these partnerships provide substantial third party validation of BEMPEG which is in addition to further commitment to BEMPEG last year from Bristol-Myers Squibb (BMY).
SFJ will fund up to $150 million for the Phase II/III trial based on the strength of the clinical data generated to date for BEMPEG in melanoma and other tumor types, and following an extensive due diligence process conducted by Blackstone Life Sciences and Abingworth.
Nektar is executing well of late and the innovative collaboration with SFJ is another example as it provides NKTR with substantial non-dilutive funding. Merck is an excellent partner and a leader in the PDL-1 space with Keytruda.
The bottom line is our confidence is growing in the potential for BEMPEG combos as the Merck and SFJ deals represent significant third party validations for NKTR. We rate the stock a "buy" under $35 with a target price of $60 per share.
