Biotech Values

[drbio45]

May 24, 2012 From Alex To -- CLDX: Striking Breast Cancer Data

• Once in a while in cancer research, we have a nirvana moment. One of the new drugs
demonstrates striking efficacy in a particular cancer type. We have been lucky in the
last 3 years to have had several such moments. To those we would include when Pfizer
(PFE) presented initial Xalkori (crizotinib) trial results in ALK-positive lung cancer,
and when Plexxicon (later acquired by Roche) presented initial Zelboraf trial results in
BRAF-positive melanoma. Now we can add to these milestones of cancer research yesterday
afternoon's data release by Celldex on the CDX-011 Phase 2 trial in GPNMB-positive breast
cancer.

• The efficacy was most striking in the triple negative patients who are also high
GPNMB expressers: 36% partial response rate in patients who received CDX-011 versus 0% in
the patients receiving best of current care. The disease control rates were even more
telling: 82% versus 33%. Even with the data set being highly immature, the
progression-free survival (PFS) in this patient population is already statistically
significant. We would certainly consider this data set in the league of crizotinib and
Zelboraf data cited above. Importantly, even only counting the triple negative breast
cancer patients who are also high expressers of GPNMB, the market for CDX-011 is already
far bigger than crizotinib's and about in on a par with Zelboraf. But, the data for
CDX-011 in triple negative patients in general, and in GPNMB-positive patients in
general, are also encouraging. The striking data in the triple negative patients have
much to do with the complete lack of treatment options for these patients. We suspect
that in other subgroups of breast cancer, if CDX-011 were combined with Herceptin
(ROG.VX) in HER2-positive patients, or combined with Afinitor (NVS) in ER-positive
patients, insofar as these patients are high GPNMB expressers, the results could be very
good as well. This is before the drug is explored in a slew of other cancers outside of
breast cancer. In words, CDX-011 is not only the latest success in targeted therapy, it
also stands to be the targeted cancer therapy with the broadest potential application.
Consequently, the commercial potential of the drug could be beyond anything we have seen
to date in the cancer market.

• So, for the army of business development personnel from big cancer players who are
packing their bags heading to Chicago for ASCO next week, they may want to consider
changing their destination to Phillipsburg, New Jersey instead.

Alex To, MD
Managing Member
Cross Current Research, LLC
2 Research Way, 2nd Floor
Princeton, NJ 08540
609-243-0082 (office)
917-584-6903 (cell)
[e-mail]
https://www.crosscurrentllc.com