Shares of Seattle-based Aptevo Therapeutics Inc. (NASDAQ:APVO) rose 58.7 percent on Friday to $2.11 as the company unveiled the sale of three noncore hematology drugs for up to $74.5 million to Saol Therapeutics and regained full rights to an experimental bispecific antibody immunotherapy for metastatic castration-resistant prostate cancer (mCRPC) from Morphosys AG.
The rationale for Morphosys’ decision wasn’t immediately clear. Aptevo, spun out from Emergent Biosolutions Inc. last August, regained global development and commercialization rights to the candidate, MOR-209/ES-414, which it plans to continue evaluating in an ongoing phase I trial.
Marvin White, president and CEO of Aptevo, told BioWorld the sale represents delivery on a promise to shareholders that the company would continue to invest in R&D while using assets Emergent contributed to fund its work. Near term, that work will include advancement of multiple candidates from the company’s Adaptir modular protein technology platform, which is primarily focused on T-cell engagers, bispecifics that target CD3 and a tumor antigen.
The company’s to-do list includes continuation of an ongoing dose-escalation phase I study of the CD3- and prostate-specific membrane antigen-targeting ‘209/’412 candidate, which Aptevo has renamed APVO-414. There’s also an ongoing phase II program for otlertuzumab, a chronic lymphocytic leukemia candidate, and plans for future phase I studies of other bispecifics focused on engaging the immune system. Among the latter group is ALG.APV-527, a bispecific antibody candidate partnered with Lund, Sweden-based Alligator Bioscience AB that is designed to simultaneously target 4-1BB (CD137) and an undisclosed tumor antigen.
Fuel for the road
The sale, announced late last Thursday, includes three marketed products for Roswell, Ga.-based Saol: Winrho SDF for autoimmune platelet disorder and hemolytic disease in newborns; Hepagam B for the prevention of hepatitis B following liver transplant and for treatment following HBV exposure; and Varizig, for treatment following exposure to varicella zoster virus for people with compromised immune systems.
An up-front payment of $65 million accounts for the bulk of the sale’s value, with a potential milestone payment of up to $7.5 million tied to hitting gross profit goals. Aptevo also stands to receive up to $2 million related to collection of certain accounts receivable after the sale’s close. About $20 million in proceeds will go to repaying a loan Aptevo took from Midcap Financial Trust in connection with the spin-off. The remainder will be used to continue investment in the company’s R&D platform.
Aptevo is hanging on to all its Adaptir-derived candidates, as well as Ixinity, an approved I.V. recombinant factor IX therapy for treatment of hemophilia B in which White said the company sees significant growth opportunities.
Making bispecifics unique
Jane Gross, Aptevo’s chief scientific officer, said her company’s Adaptir technology is differentiated from other bispecifics in that all the molecules are homodimers with features such as an immunoglobulin body, which give it antibody-like properties such as an extended half-life and improved manufacturing attributes.
With ongoing testing of APVO-414, the company is continuing work to validate the platform and its approach. In the initial cohorts of the phase I dose-escalation study, 12 patients with mCRPC were treated with weekly I.V. infusions of the candidate. Seven of the patients developed anti-drug antibodies (ADA) with very high titers and none had any adverse reactions. An amended protocol employing continuous I.V. infusion and two cohorts of patients has completed dosing without any dose-limiting toxicities. Three of six patients developed ADA but with markedly lower titers. Additionally, drug was detected in the serum of all patients, the company said.
“Our goal is to get to the maximum tolerated dose and then move into other dosing regimens,” said Aptevo’s chief medical officer, Scott Stromatt. Now that the company has moved past elevation of ADA to such a high degree with continuous dosing, it can increase the dose and look for signs of clinical efficacy. Combination testing with a checkpoint inhibitor and Xtandi (enzalutamide, Pfizer Inc.) are also in the works.
What happens next with APVO-414, a first-generation molecule from the Adaptir platform, is still to be determined. It could advance or potentially come to a stopping point, having provided validation of the evolving Adaptir platform. Either way, White said the company will be keeping busy, and plans to announce additional assets headed into the clinic.