INVESTMENT THESIS
Dendreon’s flagship product, Provenge (sipuleucel-T), an autologous cellular immunotherapy, was approved in 2010 for the treatment of asymptomatic or minimally symptomatic metastatic CRPC. We believe the current valuation of DNDN has factored in an extremely bearish scenario for both topline and bottom-line growth, thereby creating a great buying opportunity. In our view, investor concerns relating to “competition” with Zytiga are overdone, as we do not view Zytiga and Provenge as “either/or.” Rather, we expect them to be used in sequence or in combination. Longer term, we see new players, including JNJ, MDVN, and Astellas to expand the pre-chemo market by actively targeting urologists and promoting them to proactively identify and treat mCRPC patients earlier than under the current treatment paradigm. We expect the new management team to turn the Provenge launch around with more targeted marketing strategies and an upgraded sales/marketing team.
DISCUSSIONS
Phase II Provenge with Concurrent versus Sequential Zytiga + Prednisone trial should shed light on the optimal timing of Zytiga with Provenge
In December 2011, DNDN initiated a randomized, open-label, phase II trial (NCT01487863) evaluating Provenge with concurrent versus sequential administration of Zytiga plus prednisone in men with metastatic castrate resistant prostate cancer (mCRPC). The trial has completed an enrollment target of 60 patients, and expects to complete treatment for all
patients in 4Q12, with initial data expected in 2013. In the concurrent arm, patients will receive Zytiga plus prednisone the next day after the first infusion of Provenge. In the sequential arm, patients will receive Zytiga plus prednisone six weeks after the last infusion of Provenge. The primary endpoint of the trial is to compare the cumulative CD54
upregulation between the two arms. Secondary endpoints include evaluating Provenge product parameters of cumulative CD54+ cell count and total nucleated cell count, peripheral immune responses to Provenge, and the safety of the two regimens.
This data from this trial should shed light on the optimal timing of Zytiga with Provenge. It will answer the questions on whether the product Provenge can be made and immune response can be produced with no issues with the administration of Zytiga/Prednisone at the same time or sequentially. Right now, clinicians may be concerned about the possible abrogation of an early T-cell proliferation (which might be the key in generating an immune effect) with the proximate exposure of the patient to the steroid (prednisone). Therefore, they try to delay Zytiga plus prednisone for ~12 weeks after completing Provenge. The phase II Provenge and Zytiga/Prednisone trial may shed light on the effect of low doses steroids on the immune response to Provenge and potentially remove clinician’s concern on the long delay Provenge and Zytiga/Prednisone therapies.
MDV3100 moving to pre-chemo CRPC could be a positive for Provenge
In anticipation of MDV3100’s potential role in pre-chemo CRPC and responding to investigator’s enthusiasm, DNDN has decided to initiate a trial evaluating Provenge/MDV3100 sequencing trial. Currently, DNDN is obtaining feedback from
physicians on the trial design. DNDN management has not disclosed the details on the trial design, but indicated the trial design should be similar to the Provenge/Zytiga trial in terms of using immune response as the endpoints. MDV3100 does not require the concurrent administration of prednisone, which has unknown effects on the immune response induced by Provenge. Therefore, we view the potential advancing of MDV3100 to the pre-chemo CRPC as positive for Provenge.Ideally, we believe clinicians would like to combine or sequence immunotherapy such as Provenge with their best next line of therapy.
Dendreon’s flagship product, Provenge (sipuleucel-T), an autologous cellular immunotherapy, was approved in 2010 for the treatment of asymptomatic or minimally symptomatic metastatic CRPC. We believe the current valuation of DNDN has factored in an extremely bearish scenario for both topline and bottom-line growth, thereby creating a great buying opportunity. In our view, investor concerns relating to “competition” with Zytiga are overdone, as we do not view Zytiga and Provenge as “either/or.” Rather, we expect them to be used in sequence or in combination. Longer term, we see new players, including JNJ, MDVN, and Astellas to expand the pre-chemo market by actively targeting urologists and promoting them to proactively identify and treat mCRPC patients earlier than under the current treatment paradigm. We expect the new management team to turn the Provenge launch around with more targeted marketing strategies and an upgraded sales/marketing team.
DISCUSSIONS
Phase II Provenge with Concurrent versus Sequential Zytiga + Prednisone trial should shed light on the optimal timing of Zytiga with Provenge
In December 2011, DNDN initiated a randomized, open-label, phase II trial (NCT01487863) evaluating Provenge with concurrent versus sequential administration of Zytiga plus prednisone in men with metastatic castrate resistant prostate cancer (mCRPC). The trial has completed an enrollment target of 60 patients, and expects to complete treatment for all
patients in 4Q12, with initial data expected in 2013. In the concurrent arm, patients will receive Zytiga plus prednisone the next day after the first infusion of Provenge. In the sequential arm, patients will receive Zytiga plus prednisone six weeks after the last infusion of Provenge. The primary endpoint of the trial is to compare the cumulative CD54
upregulation between the two arms. Secondary endpoints include evaluating Provenge product parameters of cumulative CD54+ cell count and total nucleated cell count, peripheral immune responses to Provenge, and the safety of the two regimens.
This data from this trial should shed light on the optimal timing of Zytiga with Provenge. It will answer the questions on whether the product Provenge can be made and immune response can be produced with no issues with the administration of Zytiga/Prednisone at the same time or sequentially. Right now, clinicians may be concerned about the possible abrogation of an early T-cell proliferation (which might be the key in generating an immune effect) with the proximate exposure of the patient to the steroid (prednisone). Therefore, they try to delay Zytiga plus prednisone for ~12 weeks after completing Provenge. The phase II Provenge and Zytiga/Prednisone trial may shed light on the effect of low doses steroids on the immune response to Provenge and potentially remove clinician’s concern on the long delay Provenge and Zytiga/Prednisone therapies.
MDV3100 moving to pre-chemo CRPC could be a positive for Provenge
In anticipation of MDV3100’s potential role in pre-chemo CRPC and responding to investigator’s enthusiasm, DNDN has decided to initiate a trial evaluating Provenge/MDV3100 sequencing trial. Currently, DNDN is obtaining feedback from
physicians on the trial design. DNDN management has not disclosed the details on the trial design, but indicated the trial design should be similar to the Provenge/Zytiga trial in terms of using immune response as the endpoints. MDV3100 does not require the concurrent administration of prednisone, which has unknown effects on the immune response induced by Provenge. Therefore, we view the potential advancing of MDV3100 to the pre-chemo CRPC as positive for Provenge.Ideally, we believe clinicians would like to combine or sequence immunotherapy such as Provenge with their best next line of therapy.