In an Oct. 26 research note, H.C. Wainwright & Co. analyst Swayampakula Ramakanth provided an overview of ImmunoGen Inc. (IMGN:NASDAQ) after assuming coverage of it with a Buy rating and an $11 per share target price. The stock is now trading at about $6.21 per share.
The Massachusetts-headquartered biotech firm is developing novel antibody-drug conjugates (ADCs) for the treatment of cancer, and its "broad pipeline could support long-term growth," wrote Ramakanth. He described ImmunoGen's three most advanced therapeutic candidates and their clinical status.
The company's lead candidate is mirvetuximab, an ADC that targets folate receptor alpha, a protein that is overexpressed in ovarian, endometrial, nonsmall cell lung and other epithelial cancers. ImmunoGen is evaluating mirvetuximab, in the SORAYA and MIRASOL Phase 3 studies, as a treatment for late-stage, platinum-resistant, high folate receptor alpha ovarian cancer in patients who received up to three treatment regimens, at least one of which included bevacizumab.
In the SORAYA and MIRASOL trial design, ImmunoGen corrected a flaw that caused the failure of the previous mirvetuximab study in ovarian cancer, FORWARD I. "Full data analysis revealed that the failure was mainly attributable to the change in FRα scoring from the more cumbersome yet accurate PS2+ scoring to the simplified 10X scoring, which introduced a population of patients with lower levels of FRα expression that were not intended to be included," the analyst wrote. The PS2+ method is being employed instead in the two current trials.
This "bolsters our confidence in the success of the ongoing Phase 3 studies," Ramakanth commented.
The analyst briefly described SORAYA and MIRASOL. SORAYA is a 110-patient, single-arm pivotal study with the primary endpoint of overall response rate. The secondary endpoint is response duration. Topline results are expected in Q3/21. Submission of a biologics license application could follow in H2/21 with approval potentially in 2022.
"The drug could become a single-agent therapy in heavily pretreated ovarian cancer patients," noted Ramakanth.
MIRASOL is a 430-patient, two-arm, randomized confirmatory study in which patients will receive mirvetuximab as a single-agent therapy or the investigator's choice of chemotherapy. The primary endpoint is progression-free survival. The secondary endpoints are overall response rate and patient reported outcomes. Topline results are anticipated in H1/22. If MIRASOL is successful, the results could help mirvetuximab get full approval in 2023. H.C. Wainwright currently forecasts U.S. sales of the drug to start at about $14 million in 2022 and peak at $307 million in 2031.
ImmunoGen's pipeline also contains two ADC candidates for the treatment of solid tumors, IMGN632 and IMGC936, Ramakanth indicated and described both.
IMGN632, which the company is developing with Jazz Pharmaceuticals, is an "anti-CD123 antibody conjugated with a novel IGN payload (DGN549) with DNA-alkylating activity inducing single strand DNA breaks," he relayed. The Phase 1 dose escalation study showed the therapeutic to be safe and tolerable. Now, it is being evaluated in a Phase 2 study as a treatment for blastic plasmacytoid dendritic cell neoplasm and relapsed/refractory acute myeloid leukemia. Data from the Phase 2 expansion cohort are slated for presentation at the American Society of Hematology's annual meeting this December.
IMGC936, which ImmunoGen is developing with MacroGenics, is an ADC targeting ADAM9, a protein that is overexpressed in various solid tumors and involved in their progression and metastasis. A Phase 1 study is scheduled to commence in Q4/20 to evaluate the safety and efficacy of IMGC936 in patients with different types of cancer.
Ramakanth also pointed out that ImmunoGen has a long history of collaboration with partners. The most recent one, announced on Oct. 19, is with Huadong Medicine, and the purpose is to develop and commercialize mirvetuximab in China. Huadong is expected to pay ImmunoGen a $40 million upfront payment and, possibly, over time, up to $265 million in development, regulatory and commercial milestone payments.
As for finances, Immunogen raised $55 million in gross proceeds on Oct. 9 by selling about 12.7 million shares of common stock through an at-the-market agreement. Now, the company has $270 million in pro forma cash, enough to cover operations through Q1/22.
Finally, Ramakanth wrote, three primary factors make ImmunoGen an attractive investment: the favorable outlook for mirvetuximab, the long-term potential of the biotech's pipeline and the continuing validation, by partners, of its proprietary technology.
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Disclosures from H.C. Wainwright & Co., ImmunoGen Inc., Transfer of Coverage, October 26, 2020
Investment Banking Services include, but are not limited to, acting as a manager/co-manager in the underwriting or placement of securities, acting as financial advisor, and/or providing corporate finance or capital markets-related services to a company or one of its affiliates or subsidiaries within the past 12 months.
I, Swayampakula Ramakanth, Ph.D., Sean Kang, Sean Lee and Arthur He, Ph.D., certify that 1) all of the views expressed in this report accurately reflect my personal views about any and all subject securities or issuers discussed; and 2) no part of my compensation was, is, or will be directly or indirectly related to the specific recommendation or views expressed in this research report; and 3) neither myself nor any members of my household is an officer, director or advisory board member of these companies.
None of the research analysts or the research analyst's household has a financial interest in the securities of ImmunoGen, Inc., CytomX Therapeutics, Inc., Jazz Pharmaceuticals plc and MacroGenics, Inc. (including, without limitation, any option, right, warrant, future, long or short position).
As of September 30, 2020 neither the Firm nor its affiliates beneficially own 1% or more of any class of common equity securities of ImmunoGen, Inc., CytomX Therapeutics, Inc., Jazz Pharmaceuticals plc and MacroGenics, Inc.
Neither the research analyst nor the Firm has any material conflict of interest in of which the research analyst knows or has reason to know at the time of publication of this research report.
The research analyst principally responsible for preparation of the report does not receive compensation that is based upon any specific investment banking services or transaction but is compensated based on factors including total revenue and profitability of the Firm, a substantial portion of which is derived from investment banking services.
The firm or its affiliates received compensation from ImmunoGen, Inc., CytomX Therapeutics, Inc. and MacroGenics, Inc. for non-investment banking services in the previous 12 months.
The Firm or its affiliates did not receive compensation from ImmunoGen, Inc., CytomX Therapeutics, Inc., Jazz Pharmaceuticals plc and MacroGenics, Inc. for investment banking services within twelve months before, but will seek compensation from the companies mentioned in this report for investment banking services within three months following publication of the research report.
The Firm does not make a market in ImmunoGen, Inc., CytomX Therapeutics, Inc., Jazz Pharmaceuticals plc and MacroGenics, Inc. as of the date of this research report.
