September 29, 2014

Provectus' ESMO 2014 poster (Updated)

A blog post about Provectus' abstract at the 2014 European Society for Medical Oncology Subgroup efficacy in patients receiving intralesional rose bengal to all existing melanoma in phase II study PV-10-MM-02, may be found here. The poster was presented yesterday in Madrid, Spain. The company's press release on it and the associated 8-K filing are here and here, respectively. The focus of the ESMO poster, as with the ASCO poster, was the subgroup All Melanoma Followed of the metastatic melanoma Phase 2 trial highlighted in yellow below, and the two sub-subgroups Bystanders Untreated and All Lesions Treated. The abstract initially stated:
"The high rate of symptom control in refractory patients, manifest in CR of injected lesions after minimal intervention, was the basis for a breakthrough therapy designation application to the US FDA based on the 28 patient “all treated” subgroup..."
The poster notes Provectus is working with ERT to address the measurement and reporting of patient reported outcomes ("PROs"), a secondary endpoint of the upcoming pivotal Phase 3 trial.
The abstract also stated:
"...and implications of the Agency’s ruling on this application will be presented."
These implications appear to be the enablement of the Phase 3's study design through, per the poster:
  • "Facilitating dialog with regulatory authorities on patient population and endpoints
  • Suggesting a substantial PFS advantage for PV-10 over historical data on comparator
  • Enabling optimization of PV-10 dose schedule"
Changes in the Phase 3 trial design in the ESMO poster compared to the ASCO one include:
  • An estimated sample size of 219 (compared to 210),
  • Four week treatment cycles (PV-10 or DTIC/TMZ) during initial 12 week treatment phase (compared to three week), and
  • [From a poster perspective] the reordering of secondary endpoints placing patient reported outcomes ("PROs") above overall survival ["OS"] (compared to OS above PROs)
The poster also teased the upcoming Moffitt murine model work to be presented on a poster at SITC in November (sub-titled in the ESMO poster's conclusion PV-10 with Immune Checkpoint Blockade for Widely Metastatic Disease):
  • "Emerging immunology data supports T-cell mediated tumor-specific response secondary to PV-10 ablation
  • Data to be presented in November on IL PV-10 in combination with immune checkpoint blockade in melanoma models may indicate clinical studies are warranted
  • Design of a Phase 1b/2 combination study is underway"
Contrast the ESMO 2014 poster conclusion below...
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...with the ASCO 2014 poster "Path Forward" section below.
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Updated 9/30/14: There are several aspects of the poster/press release that warrant further discussion, and they appear cleanly identified by the PR's four quotes.
PR quote #1: Commenting on the poster, Dr. Agarwala said, "Although the primary ablative effect of PV-10 can lead to rapid regression of injected lesions, durability of response may signal the effects of an immunologic process secondary to ablation. In addition to offering the potential to relieve symptoms of cutaneous melanoma, a robust, tumor-specific immunologic response could have the potential of changing the course of the disease." {Underlined emphasis is mine.}
Dr. Agarwala, from St. Luke's University Hospital/St. Luke's University Health Network of Bethlehem, Pennsylvania, addresses two points. First, he notes the durability or length of PV-10's response on lesions following injection (noting the last allowed injection was at week 16). Durability and durable benefit should materially contribute to long-term survival and benefit. The associated poster portion is below.
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Second, Agarwala addresses both components of PV-10's two-step mechanism of action, (a) rapid ablation and (b) immunomodulation. The associated poster portion is below.
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In each case, his comments contextualize cutaneous melanoma -- the most common type of melanoma -- and PV-10's role in defeating or containing it. Defeat would come through complete response. The FDA, however, wanted, at the time of breakthrough therapy designation ["BTD"] application, and wants, via the upcoming pivotal Phase 3 trial, the association (correlation) between complete response and symptom control more fully elucidated. Containment comes through demonstrating that if you truly effectively treat disease in Stage III (or, of course, earlier or much earlier), it forestalls or prevents it from progressing to Stage IV. See blog post Treating Cancer, and news item How much is enough, and when? (September 16, 2014).
Quote #2: Eric Wachter, PhD and Chief Technology Officer of Provectus, said, "We are very pleased to share the patient-level PFS data at ESMO that defined our design parameters for the upcoming phase 3 trial. These study results demonstrate the potential of an intralesional approach to delay progression while alleviating symptoms of locally advanced melanoma." {Underlined emphasis is mine.}
The underlined sentence above asserts the clinical value proposition of PV-10 as appropriate for the treatment of local disease, the vast majority of the melanoma market and comprised of the silent masses for which surgery, chemotherapy, etc. are their only options.
Quote #3: Wachter continued, "We are looking forward to initiation of the phase 3 trial and have assembled an experienced multi-disciplinary team to help us execute this important study. For example, we are thrilled to collaborate with ERT, Inc., experts in quantifying patient reported outcomes for pivotal oncology trials, and expect this collaboration to help place Provectus at the forefront in the study of cutaneous symptoms of locally advanced melanoma." {Underlined emphasis is mine.}
It seems to me the secondary endpoint of PROs is quite important for this patient population indicating cutaneous symptoms of locally advanced melanoma, and is addressed by Agarwala and Eric. Interestingly, and I suppose not the least bit ironically, there does not appear to be medical literature that tabulates and documents that if you stop melanoma at Stage III (when, generally speaking, if you effectively and comprehensively treat the patient you can save him or her) it won't progress to Stage IV. Potential innovational cancer drug treatment progress like PV-10 still seems to boil down to having to show that effective local treatment (where the treatment does not have to be systemic) can be a good thing. It would seem only Provectus is doing this approach of studying cutaneous symptoms in relation to ablation, and ultimately having the goal of showing when disease (melanoma) is ablated in Stage III it is forestalled from getting to Stage IV.
Quote #4: Wachter concluded, "[i] The data presented at ESMO were fundamental in allowing us be in a position to commence pivotal testing of PV-10 in locally advanced melanoma patients. [ii] Furthermore, understanding the bystander effect is critical to rational combination of PV-10 with systemic drugs in patients with significant disease inaccessible to intralesional injection, and [iii] we look forward to seeing additional data on this important topic in coming months." {Parenthetical numbering is mine.}
i. I presume this sentence refers to implications in the abstract where Provectus wrote (see underlined emphasis below): "The high rate of symptom control in refractory patients, manifest in CR of injected lesions after minimal intervention, was the basis for a breakthrough therapy designation application to the US FDA based on the 28 patient “all treated” subgroup, and implications of the Agency’s ruling on this application will be presented." The FDA's BTD denial letter referenced a determination "...based on the paucity of data on endpoints indicative of clinical benefit (e.g., pain, infection, significant bleeding)..." According to the portion of the ESMO poster below (this portion also was part of the company's ASCO 2014 poster), only 13 patients in the All Melanoma Followed (N=54) provided trackable data related to symptomatic status. How many of the subset of this group, All Lesions Treated, the basis for the BTD application, provided trackable symptomatic information? In hindsight, the answer was not enough. Eric understood it to be a "measured risk" (a phrase from the company's May 23rd conference call) to submit for BTD without enough symptomatic data; however, as he said on the same call, "...our logic seemed clearer that if we were making the patients' tumors disappear in 50 percent of the patients that was a very large effect size, and that was tantamount to making any symptoms that they might have been suffering from the tumor burden disappear."
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ii. The bystander effect represents PV-10's immunologic activity, locally in terms of (a) locoregional blistering, which Provectus believed "...may be indicative of nascent local immunologic response" (ECCO 2013) and, I believe, (b) pathologic complete response (ASCO 2014), where presumably even occult cells are destroyed, and systemically. Understanding this immunologic activity, in terms of the steps of the cancer immunity cycle that PV-10 promotes, and seeing more data will be key to the interest of Big Pharma wishing to combine their immune checkpoint inhibitors with PV-10. As the global development team leader of an immune checkpoint inhibitor said to me: "I'm not familiar with hard data on PV-10 having strong immunologic properties...However, if [it] does generate significant anti-cancer immune responses that are inhibited by [their immune checkpoint inhibitor], then such a combo could make sense."

iii. Teasing Moffitt Cancer Center's presentation at SITC 2014, and possible related data publication(s) prior to this conference.

September 21, 2014

Co-stimulatory & Co-inhibitory

Moffitt's PV-10 presentation at the 2014 annual meeting of the Society for Immunotherapy of Cancer ("SITC") is entitled Efficacy of intralesional injection with PV-10 in combination with co-inhibitory blockade in a murine model of melanoma (see Moffitt @ SITC (September 19, 2014) on the blog's News page).

Earlier this month, one of the SITC presentation's co-authors and Moffitt assistant professor and researcher, Dr. Shari Pilon-Thomas, Ph.D., co-authored an online OncLive article entitled Immunotherapy Combined With Chemotherapy for Pancreatic Cancer: A Game Changer? (see blog post Treating Cancer). In it Dr. Pilon-Thomas and her fellow authors write:
Of note, the immune system’s involvement in cancer development and progression has sparked much interest in recent years. The model of the cancer-immunity cycle suggests an interplay of immune-suppression and immune-stimulation. In normal individuals, a state of immunosurveillance is in place. However, within the tumor microenvironment, inhibitory signals and immunosuppressive cells are present and tip the scale in favor of immune suppression. {Underlined emphasis is mine}
Continued: The idea of the cancer-immunity cycle proposes that, for a cancer immune response to be generated, the net balance between immune stimulation versus immune suppression must be tipped in favor of the former. Studies in various cancers have suggested that tumors evade the immunogenic process mostly by factors that promote immunosuppression. {Underlined emphasis is mine}
The theory of immune surveillance suggests, according to Peggs et al., "...that the immune system plays a key role in suppressing tumor growth and that the incidence of cancer would be much greater were it not for the ability of the immune system to identify and eliminate nascent tumor cells...While the immune system appears capable of eliminating or containing early tumor growth, some tumor cells escape detection and eventually cause cancer." Said another way, when thinking about the growing potential role and promise of cancer immunotherapy, "...we continually develop malignant cells every day that are consumed by the immune system to prevent tumor development, and the immunotherapy drugs seem to target the failure of immune recognition and immune response" (Dr. Peter Salgo, M.D.).

The balance between co-stimulation and co-inhibition is described by Inman et al.: "If sufficient co-stimulation is provided in the presence of adequate tumor-associated antigenic stimulation, the immune system will act against tumor antigen and, thus, destroy early tumors before they become fully established. Contrarily, if co-inhibitory signaling dominates, the immune system will be tolerized to tumor antigens, and the tumor will be permitted to grow unfettered and unmolested by the immune system. If neither co-stimulatory nor co-inhibitory signals dominate, the adaptive immune system may remain in a tenuous state of equilibrium, militating against tumor outgrowth with varying degrees of success."

So, it would seem to me, generalizing (or simplifying, perhaps too much):
  • If co-stimulation > co-inhibition, the immune system can act decisively against cancer,
  • If co-inhibition > co-stimulation, cancer overwhelms the immune system and renders it ineffective or useless, and
  • If co-stimulation = co-inhibition (that is, some sort of equilibrium state), the immune system wages battles against cancer to varying degrees of success with potentially no ultimate resolution to the war itself.
[Daniel] Chen & Mellman (2013), authors of Oncology Meets Immunology: The Cancer-Immunity Cycle, note stimulatory and inhibitory factors at step of the cycle.
Click to enlarge. Figure 2 (above) of [Daniel] Chen et al.'s article.
The authors write:
Each step of the Cancer-Immunity Cycle requires the coordination of numerous factors, both stimulatory and inhibitory in nature. Stimulatory factors shown in green promote immunity, whereas inhibitors shown in red help keep the process in check and reduce immune activity and/or prevent autoimmunity.
[Daniel] Chen et al. then note "[t]he numerous factors that come into play in the Cancer-Immunity Cycle provide a wide range of potential therapeutic targets."
Figure 3 (below) "...highlights examples of some of the therapies currently under preclinical or clinical evaluation. Key highlights include that vaccines can primarily promote cycle step 2, anti-CTLA4 can primarily promote cycle step 3, and anti-PD-L1 or anti-PD-1 antibodies can primarily promote cycle step 7. Although not developed as immunotherapies, chemotherapy, radiation therapy, and targeted therapies can primarily promote cycle step 1, and inhibitors of VEGF can potentially promote T cell infiltration into tumors—cycle step 5."
Click to enlarge. Figure 3 (above) of [Daniel] Chen et al.'s article.
In my illustration below, found on the blog's PV-10, and the Cancer Immunity Cycle, I endeavored to show Provectus' drug promoted steps 1, 2, 3 and 7. I believe, but with no confirmation of course, Moffitt has shown via primarily their murine model work (and maybe their human study) that PV-10 promotes steps 4, 5 and 6.
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I revised my table of combination study deals to reflect [as I think they are] stimulatory and inhibitory compounds is below.
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Pilon-Thomas et al. concluded (note the article discussed immunosurveillance in the context of chemotherapy, immunotherapy and pancreatic cancer):
The cancer-immunity cycle is an ideal model to envision how tumor cells evade immuno-surveillance as well as where future modalities may intervene with hopes of potentiating tumor cell death. The cancer-immunity cycle together with the immune-modulating functions of chemotherapies that are used in pancreatic cancer creates a rationale for investigating vaccine-chemotherapy combinations. 
Studies to date have suggested benefits of adding immunotherapies to standard chemotherapy regimens. Additional benefits are also suggested by the indication that immunotherapy may render improved chemosensitivity at later dates. In addition, vaccines are often well tolerated with minimal toxicities, which make them a favorable approach. The hope is that we can identify the appropriate combination of vaccine and immune-modulating chemotherapy that will eradicate the disease. There is also likely to be a role for immune checkpoint therapy with inhibitors of PD-1 and PD-L1. Such phase I single-agent studies are currently in progress for pancreatic cancer. The results of studies so far create hope that the combination of chemotherapy with immunotherapy may be a game changer in the treatment of pancreatic cancer.
PV-10 has some interesting features that cross categories. Provectus management previously had called the drug as a chemoablative immunotherapeutic agent (later revising the descriptor to "immuno-chemoablative"). Underlined portion number one, "chemoablative," described PV-10's chemotherapeutic-like feature of rapid tumor ablation and destruction mechanism of action ("MOA"). Underlined portion number two, immuno," described the drug's MOA whereby it harnessed the immune system to battle cancer locally (at the site of injection) and elsewhere around the body.

While not specifically a vaccine because PV-10 is not antigen-specific, it could be considered vaccine-like because it is minimally or not at all toxic but expresses many, many more than one antigen.

As a side note, immune checkpoint therapy in the above Moffitt comments refers to, I believe, ipilimumab, which is why anti-CTLA4 is in step 3, priming and activation, of the cancer immunity cycle (and why Bristol-Myers is exploring the combination of ipilimumab and anti-PD-1 agent nivolumab.

[Lieping] Chen et al. write, when discussion combination therapies:
Traditional chemotherapy and radiation therapy, together with depleting mAbs or treatment with small-molecule inhibitors, all directly target and kill cancer cells, leading to the destruction of the tumour stroma and the release of tumour antigens. When coupled with these direct killing mechanisms, immunomodulatory biologics promote the priming and expansion of existing tumour-specific T cells and their de novo generation, with a potential to form long-lasting and self-sustained antitumour responses. In recent years, small-molecule inhibitors targeting tumours that harbour mutated BRAF (vemurafenib (Zelboraf; Plexxikon/Roche)) or translocated BCR–ABL (imatinib (Gleevec; Novartis)) have shown high initial response rates in clinical trials165. However, the duration of the antitumour response is limited owing to acquired drug resistance. A combination of these fast-acting small-molecule inhibitors with immune co-inhibitory blockade — for example, with CTLA4-specific or PD1-specific mAbs — could promote the priming and expansion of tumour-specific CTLs against multiple tumour antigens and/or epitopes, prevent the generation of escape variants or drug-resistant mutant cancer cells and induce sustained T cell responses. {Underlined emphasis is mine.}
Circling back to beginning of this post, Moffitt's presumed presentation at SITC potentially entitled Efficacy of intralesional injection with PV-10 in combination with co-inhibitory blockade in a murine model of melanoma, the cancer center previously have described their successful pre-clinical work that combined PV-10 with systemic immunotherapies to mean, I believe, checkpoint inhibitors (e.g., ASCO 2014).

The interplay of co-stimulation and co-inhibition (with the goal of more of the former than the latter), and Moffitt's use of what seems to be the broader term co-inhibitory blockade, I wonder whether their work describes the better therapeutic outcome of PV-10 and inhibitory factors of step 7 of the cancer immunity cycle above (see Figures 2 and 3 of [Daniel] Chen et al.).

September 18, 2014

Treating Cancer

In my September 22, 2013 investment letter entitled Why I'm Long Provectus Biopharmaceuticals, which you can find and/or read in its entirety on the blog's page of the same name (see the right sidebar entitled Pages) I wrote:
PV-10, a novel oncology compound being developed by Knoxville, Tennessee-based Provectus Biopharmaceuticals, Inc. (“Provectus” or the “Company”) (NYSE MKT: PVCT), exemplifies innovation over incrementalism, meaningful over marginal, productized technology over hypothetical, and changing the world over accepting the status quo, with not an insignificant amount of serendipity over contrivance. In sum, these form the quintessential essence of a paradigm shift in the treatment of cancer. 
It seems to me traditional modalities of cancer treatment look like this:
Surgery is the first line of defense when early stage cancer first strikes, while therapies and treatments and repetitions and combinations of them are fall back positions as cancer progresses and recurs towards its later stages.

I contend PV-10 is a paradigm shift in the treatment of cancer because it should play key roles in both ends of the disease spectrum illustrated above:
  • For earlier stages of cancer (shift #1a), the far greater majority or supermajority of those afflicted (the "silent masses"), the drug may effectively defeat or control local-regional disease to deny, prevent or forestall its metastatic and visceral spread, and present itself as a viable and far better alternative to surgery.
  • For later stages (shift #1b), the current focus of most of the biopharmaceutical industry, PV-10 may, as the tip of the treatment spear, in combination with other therapies, bring the immune system back into an immune surveillance (immunosurveillance) state to conquer heavy tumor burden and visceral disease.
See the blog's PVCT page.

Shift #1a. I think the upcoming pivotal Phase 3 trial for unresectable locally advanced cutaneous melanoma helps further make the case that if you truly effectively treat disease in Stage III (or, of course, earlier or much earlier), it forestalls or prevents it from progressing to Stage IV. I believe this because Provectus' metastatic melanoma Phase 2 trial data appeared to highlight that PV-10 injection lasted, as illustrated by progression-free survival (the time between initial treatment and tumor progression) approximately for the duration of the treatment interval of the drug. If the treatment interval was longer, PFS would be longer as well, until at some point complete response were achieved.

The FDA denied the company breakthrough therapy designation determined on the basis of the paucity of data, which I take simply to mean not enough of the data previously presented -- specifically, the sub-group of patients in the Phase 2 trial who had all of their disease treated (28 patients), which is the patient population of the Phase 3 trial.

In the upcoming Phase 3 trial Provectus will measure PFS as the trial's primary endpoint, utilize RECIST 1.1 to measure it, and inject patients every two weeks until CR or PD is achieved (i.e., the duration of the treatment interval will be until one of the two outcomes is achieved). This protocol, which is what oncologists presumably would use when treating patients, thus would see patients with all of their disease treated by PV-10 potentially never progress.

Shift #1b. This aspect of my presumed assumption of PV-10 as a paradigm shift in the treatment of cancer has yet to unfold. I was struck by an early-September article published by Moffitt staffers who include a key PV-10 researcher (Dr. Shari Pilon-Thomas) entitled Immunotherapy Combined With Chemotherapy for Pancreatic Cancer: A Game Changer?
Of note, the immune system’s involvement in cancer development and progression has sparked much interest in recent years. The model of the cancer-immunity cycle suggests an interplay of immune-suppression and immune-stimulation. In normal individuals, a state of immunosurveillance is in place. However, within the tumor microenvironment, inhibitory signals and immunosuppressive cells are present and tip the scale in favor of immune suppression.
The authors go on to write:
Chen and Mellman have delineated the cancer-immunity cycle, which depicts the immune system’s role in controlling tumor growth in normal individuals. Understanding this cycle provides insight into how tumors can evade it...The idea of the cancer-immunity cycle proposes that, for a cancer immune response to be generated, the net balance between immune stimulation versus immune suppression must be tipped in favor of the former. Studies in various cancers have suggested that tumors evade the immunogenic process mostly by factors that promote immunosuppression.
Click to enlarge.
See the blog's PV-10, and the Cancer Immunity Cycle page.

As researchers better understand how to treat late stage cancer, specifically and directly fighting tolerance and recurrence, I believe Moffitt has further their understanding of the cancer immunity cycle as it relates to the potential role(s) PV-10 does and could play. We may learn more about this in early-November at the 2014 annual meeting of the Society for the Immunotherapy of Cancer.
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September 17, 2014

#ESMO14: Subgroup efficacy in patients receiving intralesional rose bengal to all existing melanoma in phase II study PV-10-MM-02

The abstract of Provectus and its principal investigators from the company's metastatic melanoma Phase 2 trial was posted today on the 2014 European Society for Medical Oncology's conference website. The ESMO 2014 conference runs from September 26th to 30th in Madrid, Spain, and Provectus' poster is slated for the 28th. The poster is an extension of/related to the company's 2014 American Society of Clinical Oncology annual meeting poster Efficacy of intralesional rose bengal in patients receiving injection in all existing melanoma in phase II study PV-10-MM-02, where the sub-group of "All Melanoma Followed" (n=54 [out of 80]) was highlighted, together with the "Bystanders Treated" (n=26) and "All Lesions Treated" (n=28) sub-sub-groups. Both posters ultimately derive, in my view, from Provectus' 2013 European Cancer Congress poster Locoregional Disease Control in Metastatic Melanoma: Exploratory Analyses From Phase 2 Testing of Intralesional Rose Bengal.

The ESMO 2014's abstract's conclusion reads:
Recurrent locoregional melanoma can be a source of persistent morbidity, including disfigurement frequently accompanied with pain, ulceration, bleeding and infection. The high rate of symptom control in refractory patients, manifest in CR of injected lesions after minimal intervention, was the basis for a breakthrough therapy designation application to the US FDA based on the 28 patient “all treated” subgroup, and implications of the Agency’s ruling on this application will be presented. Although the primary ablative effect is responsible for CR in injected tumors, durability of response and bystander response implicate an immunologic mechanism of action secondary to ablation. {Underlined emphasis is mine}
More information may or will of course be forthcoming on the conference poster, such as:
  • Potentially, further details on the upcoming pivotal Phase 3 trial for unresectable locally advanced cutaneous melanoma,
  • Curiously, the implications of the FDA ruling on Provectus' breakthrough therapy application, and
  • Specifically, more data on the All Disease Treated sub-sub-group, such as durability of response.

September 9, 2014

Bristol-Myers vs. The Field (ex-Provectus)

Last week Bristol-Myers filed a lawsuit against Merck over [anti-]PD-1 agent pembrolizumab (trade name Keytruda), which was approved last week by the FDA for late-stage or metastatic melanoma.
Specifically, Bristol-Myers claims that Merck is violating the patent on its Opdivo mediation for tackling melanoma, which was recently approved in Japan and became the first so-called PD-1 inhibitor to win regulatory backing anywhere. A PD-1 inhibitor blocks a protein that acts as a brake on certain immune system cells and prevents them from attacking healthy tissue. (Bristol-Myers Sues Merck Over a Patent on its new Cancer Drug, The Wall Street Journal, September 8, 2014)
Merck disclosed PD-1 antibody patent oppositions and litigation, at the time in Europe, in its 10-Q filing for the period ending June 30, 2014 (see page 22):
As previously disclosed, Ono Pharmaceutical Co. (“Ono”) has a European patent (EP 1 537 878) (“’878”) that broadly claims the use of an anti-PD-1 antibody, such as the Company’s immunotherapy, pembrolizumab (MK-3475), for the treatment of cancer. Ono has previously licensed its commercial rights to an anti-PD-1 antibody to Bristol-Myers Squibb (“BMS”) in certain markets. The Company believes that the ‘878 patent is invalid and filed an opposition in the European Patent Office (the “EPO”) seeking its revocation. In June 2014, the Opposition Division of the EPO found the claims in the ‘878 patent are valid. The Company expects to receive the Opposition Division’s written opinion in the third quarter of 2014, after which it will begin the appeal process. {Underlined emphasis is mine}
As FiercePharma's Tracy Staton writes: "The lawsuit asks for damages, but more importantly, asks the court to declare that Merck infringes that PD-1 patent. Such a decision would bolster Bristol-Myers and Ono's argument that they are owed royalties on sales of rival PD-1 drugs."

As I wrote in my Why Keytruda's approval is a good thing for PV-10 (September 8, 2014) news item under the blog's News tab:
KOLs see PD-1s as treating the bulk of late stage cancer. Key opinion leaders ("KOLs") see PD-1s, which fall under the category of checkpoint protein inhibitors that also include CTLA-4 and PD-L-1 agents, as an improvement over CTLA-4 agents like approved ipilimumab (trade name Yervoy) and tremelimumab. KOLs will use PD-1s to treat as many indications as they can scientifically support. Abstracts of Merck oncology-sponsored pembrolizumab studies being presented at ESMO 2014 in late-September, for example, include bladder and gastric cancer, advanced melanoma, non-small cell lung cancer ("NSCLC"), and head and neck cancer.
Bristol-Myers and Merck's PD-1s are projected to play key roles in the supposed several tens of billions of dollars equity research analysts estimate will be derived from the immuno-oncology addressable market.

But KOLs believe the more dominant use of PD-1s will come from combining them with other drugs to treat late-stage cancer, rather than strictly using them as monotherapies. I summarized 14 previously announced and/or conducted combination studies below, and first in my Combinations (July 24, 2014) news items under the blog's News tab.
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Bristol-Myers, however, has its bases covered with a combination therapy patent that covers PD-1s and other therapeutic compounds and compound categories. Again, Merck challenged it, noting such in the above mentioned quarterly filing:
On April 30, 2014, the Company, and three other companies, opposed another European patent (EP 2 161 336) (“’336”) owned by BMS and Ono that it believes is invalid. The ‘336 patent, if valid, broadly claims anti-PD-1 antibodies that could include pembrolizumab. {Underlined emphasis is mine.}
Bristol-Myers and Ono Pharmaceutical's '878 patent covers PD-1s as monotherapies.

Bristol-Myers and Ono's '336 patent covers PD-1s in combination with other agents, and appears to include a number of companies' products including Amgen's oncolytic virus and intralesional agent talimogene laherparepvec ("T-Vec"). T-Vec had been combined with Bristol-Myer's approved [anti-]CTLA-4 agent ipilimumab (trade name Yervoy), the results of which were presented at ASCO 2014. Amgen and Merck plan to combine T-Vec with Keytruda in a trial slated to start later this year.

A Big Pharma (BMS) with a market capitalization of about $85 billion (per Yahoo! Finance as of yesterday's close) battling one (MRK) with a market cap of about $176 billion. Afterall, in 2013, Citi analyst Andrew Baum estimated potential annual immuno-oncology-related sales to be $35 billion by 2023 (cough). Titans battling...

It does not appear PV-10 is covered by Bristol-Myers and Ono Pharmaceutical's '336 combination therapy patent. PD-1s in combination with PV-10 apparently are, however, covered by Provectus' combination therapy patent application (20120263677 ["'677"]) that it jointly filed with Pfizer (through an expansion, or continuation in part, of Claim #1) in 2012. Pfizer and Provectus would share CTLA-4-related combination therapy sales revenue via the '667 patent application if/when issued, but the former has no claim in the patent app on economics derived from PD-1-related combination therapy sales.

Whether the '878 monotherapy patent ultimately prevails -- that is, whether Merck is violating the patent for tackling cancer (see paragraph 047) -- is Merck's problem, and the Big Pharma eventually may elect to direct royalties Bristol-Myers and Ono's way(s).

Merck could, however, circumvent paying the other parties by meaningfully combining pembrolizumab/Keytruda with PV-10. Directionally speaking, immuno oncology is trending towards combination therapies for late-stage cancer treatment. Strategically, PV-10 should permit Merck's PD-1 to achieve greater tumor destruction and immunological signaling, and be the perfect front end for an immunologic back-end like Keytruda for the ultimate and better benefit of patients than what the PD-1 alone could achieve as a monotherapy. This combination proposition of course would require a sound scientific and medical data-based foundation, which one hopes Moffitt Cancer Center will present and convey at the Society for the Immunotherapy of Cancer's annual meeting in early-November. Tactically, an effective Keytruda/PV-10 combination with a compelling clinical value proposition should obviate the need for royalty payments to Bristol-Myers/Ono because the '336 combination patent would not be infringed. Increasing anti-PD-1 antibody patent opposition and litigation could tip Merck's decision-making scales in favor of embarking on a near-term combination study of Keytruda and PV-10, with perhaps an eye to a longer-term combination.

September 6, 2014

Moffitt

H. Lee Moffitt Cancer Center & Research Institute has issued strongly worded press releases related to recent pre-clinical and clinical cancer trial work and research successes.

Single Injection May Revolutionize Melanoma Treatment, Moffitt Study Shows
August 22, 2013, Tampa, Fla. – A new study at Moffitt Cancer Center could offer hope to people with melanoma, the deadliest form of skin cancer. Researchers are investigating whether an injectable known as PV-10 can shrink tumors and reduce the spread of cancer. PV-10 is a solution developed from Rose Bengal, a water-soluble dye commonly used to stain damaged cells in the eye. Early clinical trials show PV-10 can boost immune response in melanoma tumors, as well as the blood stream.
Moffitt Cancer Center Instrumental in FDA Approval of Revolutionary Two-Drug Combo to Treat Advanced Melanoma
January 23, 2014, Tampa, Fla. – Moffitt Cancer Center researchers have laid the groundwork for a revolutionary new combination therapy for the treatment of advanced melanoma – melanoma that cannot be removed surgically or has spread to other areas of the body. The newly FDA-approved therapy, Mekinist (trametinib) in combination with Tafinlar (dabrafenib), is one of the biggest advancements in melanoma treatment in the past 30 years.
Moffitt Cancer Center Plays Pivotal Role in FDA Approval of New Anti-PD-1 Inhibitor Keytruda for Metastatic Melanoma
September 4, 2014, Tampa Fla. – The U.S. Food and Drug Administration (FDA) announced the approval of a new cancer immunotherapy today to treat patients with metastatic melanoma, Keytruda (pembrolizumab) by Merck & Co.

Quotes and statements from Moffitt about PV-10
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September 2, 2014

A China Tale, and Process

From the traditional folksong of Tiger Woman,
adapted by Laurence Yep
From Peter's first trip to China in November 2012 when he began to engage Chinese pharmaceutical companies for a regional partnership, to Eric and Peter's recent trip in August 2014 (the former's first) to sign a memorandum of understanding ("MOU") with one of them, Provectus principals have made five trips to China. These also include February, September and December 2013. 

The November 2012 trip comprised introductory meetings with companies of varying size and geographic scope. Subsequent follow-ups with some additional initial get-togethers too, essentially trips in 2013, comprised gradually more serious meetings with a short-list of more interested companies and increasing senior levels of their leadership. These introductions were facilitated by a number of individuals, agents and third parties that included strategic advisory board members, Network 1 Financial, and Maxim Group. Potential partners have interacted with Provectus in the interim via e-mail and phone, and conducted due diligence via the company's electronic data room. The culmination of these efforts and trips resulted in a first MOU for a China regional partnership with two subsidiaries of Sinopharm Group in August.

Generally speaking, an MOU is to a licensing deal or business relationship what a term sheet is to a venture capital investment and a letter of intent ("LOI") is to an acquisition: formalizations and acknowledgements of serious discussions towards the above mentioned ends, frameworks or outlines of business-investment-acquisition terms, conditions, rights, etc., and lists or mentions of other customary and perfunctory ifs, ands or buts.

Provectus noted in their press release:
During the next three months, the parties will seek to enter into a definitive licensing contract, subject to additional negotiation, due diligence, and any required regulatory and corporate approvals. The parties will further address the details of the license; the use of the technology from Provectus to Sinopharm A-THINK in China; the process for commercialization; and payments to Provectus (upfront, milestone and royalties). Provectus intends to manufacture PV-10 in the USA and Sinopharm A-THINK will distribute PV-10 in China. {Underlined emphasis is mine}
I'm reminded of our corporate venture capital process back in the day (our process flow is below), which I believe is a reasonable facsimile of Provectus' process and the process from Sinopharm's perspective in this situation.
Click to enlarge.
Preliminary analysis/assessment. Prior to Peter's trip, third parties introducers would have pre-submitted information about Provectus, PV-10, summary and previously public information about pre-clinical and clinical data, regulatory interactions, etc. to potential Chinese pharmaceutical company partners for their analysis and assessment, and to gauge any interest to learn more.

Management team meeting(s). The parties would have had an initial meeting, and potentially or eventually other more serious ones.

Due diligence. Although the graph above is linear and discrete in its steps, some actions are undertaken in parallel and are continuous, like due diligence, even after engagement is formalized. The potential licensee-investor-acquirer conducts due diligence in advance of and after the initial management team meeting, and as more meetings are conducted. As Provectus mentioned on several of its conference calls this year, Chinese companies (among others) have visited the electronic data room to review the various different types of documents stored there.

Due diligence of course goes beyond reading introductory collateral material, meeting management, and visiting data rooms. It extends to on-site visits of the business (Provectus), where clinical work is carried out (e.g., St. Luke’s Cancer Network, Moffitt Cancer Center) and with the people carrying this work out (e.g., Dr. Sanjiv Agarwala, M.D., Moffitt personnel), and other relevant and germane people, companies and institutions, and places. I imagine these due diligence activities are to come.

Term sheet negotiations. At some point, interest rises to a level where the parties can discuss price expectations and their associated structure, terms and conditions. If the parties can reach sufficient preliminary consensus they feel could ultimately lead to a transaction (but with no certainty nor obligation [unless they elect to bind themselves] to do so), they enter into or agree to an MOU-term sheet-LOI. As the jargon goes, MOUs are agreed to by the parties, while term sheets and LOIs are extended by one party to the other.

Negotiations of definitive agreements. When continuing due diligence is satisfactorily wrapped up, should the consensus remains the consensus, and if the broad and not so broad strokes of the MOU-term sheet-LOI are conveyed to definitive agreements, a definitive license-investment-purchase agreement may be struck for signing.

Deal closing. Documents are signed. Signatures are swapped. Money, securities, licenses, etc. change hands.

The process.

MOUs can be serious documents, and they can be far from serious. Sometimes also known as "Barney agreements" (i.e., "I love you, you love me") during the dot com era, Internet companies would enter into them with more established companies or other like venture-backed firms in hopes of demonstrating or simply giving the illusion of progress, business value creation, and rationale for increased valuation.

In the past management has garnered license and acquisition interest, in hand or through conversation, but nothing that rose to the level of both seriousness (met price expectations) and tangibleness (was on paper). For example*:
  • Galderma's rumored 2010 interest in Provectus' dermatology business (on paper, but not serious),
  • A Big Pharma's rumored 2011 interest to buy the intralesional drug compound company (not serious, and not on paper),
  • Orbimed and Domain Associates-backed Eddingpharm's rumored 2013 interest to license PV-10 for sale in China and its territories (on paper, but not serious), and
  • The above Big Pharma's rumored 2014 interest to acquire Provectus for twice its 2011 bid (still not serious enough, and still not on paper).
Provectus' MOU with Sinopharm is the first serious commercial interest the company has tangibly garnered. Tangibly serious because (i) it met management's price expectations as translated into potential payments to Provectus (i.e., upfront, milestone and royalties) and (ii) it was on paper.

To what, if anything, will/could the MOU between Provectus and the Sinopharm subsidiaries lead? The easiest way to answer this question of course is to wait and see if/when a license deal transaction is consummated between the parties. In the interim, I look at the situation this way: Provectus agreed to sign a document that formalized their discussions with Sinopharm towards the end of consummating a license deal and business relationship with the Chinese healthcare company under a framework of financial and business terms and conditions that may good to great [for Provectus], and we should know by mid-November or earlier if the parties ultimately do something together.

Finally, I wanted to comment on some of the verbiage in the MOU PR:
The MOU contains customary provisions regarding confidential information, publicity, and intellectual property, and is non-binding upon the parties (except for certain non-material provisions). The MOU shall continue in effect until the earliest of the replacement of the MOU with a definitive agreement, one month prior written notice by either Provectus or Sinopharm, or ninety days from the signing of the MOU.
In order to facilitate my comments, I also provided a sample or model venture capital investment term sheet below, which I utilized during my corporate venture capital investment days.


Click to enlarge. Sample venture capital investment term sheet, page 1.
Click to enlarge. Sample venture capital investment term sheet, page 2.
Click to enlarge. Sample venture capital investment term sheet, page 3.
Click to enlarge. Sample venture capital investment term sheet, page 4.
Click to enlarge. Sample venture capital investment term sheet, page 5.
Click to enlarge. Sample venture capital investment term sheet, page 6.
Click to enlarge. Sample venture capital investment term sheet, page 7. 
Click to enlarge. Sample venture capital investment term sheet, page 8.
Click to enlarge. Sample venture capital investment term sheet, page 9 (of 9).
Provectus' MOU PR naturally did not discuss "price," or payments to Provectus (upfront, milestone and royalties). Management would not have signed an MOU if those elements were neither to their liking nor codified (summarily or specifically) in the document. The first page of a term sheet (i.e., page 1 above) or the first paragraph of an LOI, aside from pleasantries, typically addresses the headline numbers of a prospective deal. I previously have commented on this blog about Provectus' price expectations for a China partnership. One wouldn't have expected the company to detail price agreements with Sinopharm in either the PR or the associated 8-K filing. Additional MOUs maybe forthcoming, and there may be competitive interest. Then again, there may not be dueling interest that pushes price upwards, and I would presume Provectus then would be comfortable with price as outlined in the Sinopharm MOU (with perhaps some further wrangling to finalize agreement on the timing of payments).

The MOU PR discussed "customary provisions regarding confidential information, publicity, and intellectual property," some of which find commonality with the venture capital investment term sheet (i.e., page 7, Confidentiality). Later versions of my terms sheets included sections dealing with publicity, and intellectual property (of the target company) as and when appropriate.

MOUs, term sheets and LOIs are broadly binding (i.e., material and non-material provisions) when the parties agree to be so bound, or when one party wants the other party to be bound and the other party agrees to such binding. Usually, as illustrated by the sample or model term sheet above, these relationship documents generally aren't binding in any meaningful way (to allow an out for either party, but many times the the one wanting to partner, invest or purchase). For non-material binding provisions see page 8, Binding Provisions. For outs, see page 7, Conditions to Closing.

As the MOU PR noted, the term sheet often references the definitive investment (or securities purchase) agreement that replaces the MOU or term sheet. See page 7, Purchase Agreement or page 1, introduction, for example.

Term sheets often include a target closing date (see page 7, Closing Date) by which time the parties hope or seek to complete their negotiations to consummate a transaction (i.e., finalize definitive agreements, sign them, exchange whatever). The parties mutually agree on a timeframe; however, the closing date is not set in stone and can be mutually modified through subsequent revisions to the term sheet (in large part to maintain exclusivity until a transaction is done). Provectus MOU PR noted a ninety-day period, which should be the target or contemplated closing date.

Exclusivity clauses almost always are part of terms sheets and LOIs to provide sufficient timing for the parties (especially the motivated one) to consummate a transaction. They may be part of an MOU in terms of the transaction (i.e., Sinopharm may exclusively negotiate with Provectus until such time as a deal is done, or the parties part ways). I imagine if the MOU had an exclusivity clause, the MOU PR would have mentioned it (not saying anything about it says something too). Exclusivity certainly may be part of the business terms; in this case it is: "Sinopharm-CSIPI and Sinopharm A-THINK desire to obtain an exclusive license to commercialize PV-10 within [the People's Republic of] China territory, and PVCT is willing to grant such license to Sinopharm."

* Listen to Provectus' echo chamber long enough, do some due diligence and, pardon the pun, connect some dots, and you eventually make out what the original voice that started the echo said or meant to convey. And while it doesn't mean a hill of beans if it's not translated into share price, the sound nevertheless is informative and instructive.