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Looking out for Rindo: Stock sale garners Celldex $162M

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By Randy Osborne
Staff Writer

Celldex Therapeutics Inc.’s public offering of 7 million shares at $24.50 each brings net proceeds of about $162.7 million, which should get the Hampton, N.J.-based firm “comfortably through 2016,” said CEO Anthony Marucci. “We came into the [financing] with $136.6 million already on the balance sheet,” he noted.

Two Phase III programs are under way, with rindopepimut, often known as “rindo,” in the lead and expected to complete accrual next year. An immunotherapeutic vaccine designed to target EGFRvIII, rindo is being tested in glioblastoma multiforme (GBM) patients whose brain tumors overexpress the oncogene, which means a significantly worse prognosis.

In Phase II trials against advanced, recurrent GBM, rindo turned up signs of clinical activity in patients with naïve disease as well as those refractory to Avastin (bevacizumab, Roche AG). Early results showed trends toward overall survival and progression-free survival (PFS) upsides in the rindo arm, though the data still are maturing.

Celldex said earlier this week that it’s cranking up another Phase III trial, called METRIC, with the antibody-drug conjugate (ADC) glembatumumab vedotin (CDX-011) in patients with metastatic, triple-negative breast cancer (TNBC).

CDX-011 targets TNBC tumors that overexpress glycoprotein nonmetastatic melanoma protein (GPNMB), implicated in the spread of TNBC as well as melanoma and squamous cell lung cancer. Phase II trials will start next year in the latter two indications.

“We had a Phase I/II study in melanoma that had a 15 percent response rate and a PFS advantage in fourth-line melanoma,” Marucci told BioWorld Today. “The reason we went ahead with the [TNBC] study first is that we were intrigued by the response rates we were seeing in the breast study, and we thought that was a more open field for us.”

At the time, the melanoma therapies Yervoy (ipilimumab, Bristol-Myers Squibb Co.) and Zelboraf (vemurafenib, Roche AG) were in the clinic, “and we just felt that we would be able to do a breast study quicker than we would a melanoma study,” Marucci said. Both of those other drugs have since been approved. “Now that the field has kind of cleared itself, and we know what’s first-line [therapy] and what’s second-line, we think CDX-011 in third and fourth-line melanoma is a good place for us to start.”

In squamous cell lung cancer, GPNMB is “expressed at some pretty high levels” in as much as 50 percent of the patient population, Marucci said. “That will be a very interesting setting for us,” and the Phase II trials will begin “within a couple of months of each other,” in the second half of next year, he said.

By the end of 2016, “we should have a biologics license application filing or approval of rindo in GBM,” as well as a BLA filing for CDX-011, “and obviously the rest of the pipeline will be later-stage at that point,” Marucci said.

“We’ve been quite acquisitive since we spun out [of Princeton, N.J.-based Medarex Inc. in 2005],” he said. “We’ve done some nice deals around some good assets, as well as our own in-house development of other programs. We think we’re in good shape.” (See BioWorld Today, April 14, 2004.)

Jefferies LLC and Leerink Swann LLC are acting as joint book-running managers of the offering, expected to close on or about next Tuesday. Guggenheim Securities, Oppenheimer & Co. Inc., Wedbush PacGrow Life Sciences, Brean Capital LLC, Cantor Fitzgerald & Co., and Roth Capital Partners are serving as co-managers. Underwriters have a 30-day option to buy about 1 million more shares.

Celldex’s stock (NASDAQ:CLDX) closed Thursday at $25.11, down $1.05.

In other financing news:

Lorus Therapeutics Inc., of Toronto, said it will file a final prospectus relating to the previously disclosed public offering of about 12.7 million shares for 55 cents each, for gross proceeds of about $7 million. Lorus entered an underwriting agreement with a syndicate of underwriters co-led by Clarus Securities Inc. and Canaccord Genuity Corp. and including Jennings Capital Inc. and D&D Securities Inc.

Oculus Innovative Sciences Inc., of Petaluma, Calif., disclosed an offering to sell securities to select accredited investors for gross proceeds of $2.2 million, the net of which Oculus intends to use for working capital and general corporate purposes.