On Wednesday, Telesta Therapeutics (Telesta Therapeutics Stock Quote, Chart, News: TSX:TST) announced it had entered into a licensing agreement with French pharmaceutical company, Ipsen, whereby Ipsen gains exclusive European (and certain other ex-US jurisdictions) marketing rights to Telesta’s regulatory-stage bladder cancer biologic, Mycobacteria phlei cell wall-nucleic acid complex (MCNA). Under the terms of the agreement Telesta receives US$10M upfront, another US$127 in potential regulatory sales and regulatory milestones, and a “meaningful” double-digit royalties on net sales.
Signing a validating European partnership is another notable achievement for Telesta in a year that has gone pretty well to script. Readers of Cantech will recall previous articles on Bioniche, the former name of Telesta, and its transition from a hybrid animal and human health company to its current existence as a pure-play human therapeutics company. Where Bioniche seemed to chronically underachieve, Telesta has arguably overachieved. With a renewed focus on human therapeutics, the company set out an ambitious plan to get MCNA approved by FDA without making any substantial new clinical investment. The company had completed one positive Phase III study in 2009, and felt those results, coupled with the lack of alternative therapies for these very ill bladder cancer patients (actual indication they are pursuing is BCG refractory non-muscle-invasive bladder cancer) made for a compelling argument for FDA to consider MCNA for approval. This September FDA agreed, giving MCNA priority review with a PDUFA date, a date FDA aims to make an approval decision by, of February 27th, 2016.
But before FDA weighs in on whether MCNA will be approved, on November 18th a committee of medical opinion leaders convened by FDA will get their say. Known as an Advisory Committee (Adcom), a group of medical experts will discuss / debate the efficacy, safety, and clinical need for MCNA before voting on whether they believe the drug should be approved. This is a high stakes event for companies, like Telesta, seeking approval for a new drug. McKinsey & Company, a leading management consulting firm, in a 2013 report, noted that FDA approved 88% of new drugs that were endorsed by Adcoms, and denied approval to 86% of those that were not endorsed.
In some cases the outcome of an Adcom is relatively predictable, usually based the unequivocal strength, or lack thereof, of the clinical data being discussed. Such is not the case with MCNA, where the data from the Phase III study, albeit positive, are not without their obvious shortcomings. These shortcomings are mainly due to the study design, being single-arm and open-label. Also FDA generally requires two Phase III studies for approval, so the totality of the data from Telesta’s one and only Phase III with MCNA is arguably less than what is generally expected.
With these issues in mind, Telesta’s one Phase III study with MCNA did show a one-year survival benefit for 25% of study patients and 19% at two-years, demonstrating what was described in The Journal of Urology as “significant activity”. Perhaps equally important for MCNA’s chances is the clear medical need for additional therapeutic options for BCG refractory bladder cancer patients, who have few options besides a cystectomy (removal of the bladder). As stated in The Journal of Urology paper, “MCNA offers an option for patients who are not candidates for or who refuse cystectomy.”
These are just some of the issues that will be debated on November 18th. Needless to say, but Telesta investors should certainly be cognitive of this date, and expect volatility before and after the event.
Disclosure: Hogan Mullally is a shareholder of Telesta Therapeutics.