MedImmune Inc. acquired rights to a cancer vaccine technology simultaneous with releasing first-quarter financial results that beat consensus estimates.
The Gaithersburg, Md.-based company entered an agreement with Cerus Corp. to develop and commercialize a therapeutic vaccine designed to treat cancers of the breast, prostate and colon, as well as metastatic melanomas. Cerus' vaccine technology is designed to engineer vaccines to specific cancer antigens, such as the EphA2 protein, a target of note to MedImmune.
Jamie Lacey, MedImmune's director of media and public relations, pointed to the upside of "applying new bacteria-mediated strategies for treating or preventing cancers that express the EphA2 protein." She added that both companies have worked jointly on a research basis since last year.
Prior to beginning that relationship, MedImmune in October 2001 licensed worldwide rights to EphA2 technology from the Purdue Research Foundation. The company said it expects that Cerus' technology might be useful in developing a vaccine to stimulate the immune system to attack cancerous cells expressing EphA2.
"This is an additional validation of the technology," David Cook, Cerus' vice president of research and development, told BioWorld Today. "And the rights that we've out-licensed are specific to EphA2, so there's plenty of room for us to develop the technology with our own antigens, as well as to partner with others."
The technology uses an engineered strain of the bacteria Listeria, characterized by reduced toxicity without compromising immunogenicity. Concord, Calif.-based Cerus said Listeria links innate immune responses to adaptive antigen-specific responses.
MedImmune and Cerus reported preclinical data at the American Association for Cancer Research meeting showing that an EphA2 vaccine induced an antitumor response and prolonged life in mice. In the study, they implanted mice with tumors and then treated them with Listeria strains that had been genetically engineered to trigger an immune response directed at the EphA2 protein. Specifically, the results demonstrated that 80 percent of treated mice survived for more than 43 days following tumor implantation, while untreated controls had a median survival of about 20 days.
"The EphA2 target that MedImmune owns is very attractive," Cook said. "It's expressed broadly across many different tumors, and it seems to play a fundamental role in the development of tumors."
Research efforts going forward include evaluating the program in more tumor models and exploring additional optimization strategies with the Listeria strain, Lacey said. Both parties will collaborate on future preclinical studies designed to advance the program into clinical trials.
MedImmune would be responsible for clinical testing, manufacturing and commercialization of resulting products. Cerus will receive an up-front payment and development funding for additional preclinical work, and could receive milestone payments and royalties on future sales. Cook declined to provide more specific financial terms.
But Cerus will continue to apply its vaccine technology to other cancers and chronic infectious diseases. Using an antigen called mesothelin, the company is evaluating its vaccine platform in pancreatic and ovarian cancers.
Cerus also focuses on blood pathogen-inactivation methods through its Intercept system. Co-developed with Baxter Healthcare Corp., of Deerfield, Ill., Intercept's use with platelets is approved in Europe, and the company plans to file for regulatory clearance of the product's use with plasma by the end of the year. A Phase III trial of Intercept for red blood cells was halted last year, but Cook said the process remains in laboratory work.
Investors warmed to Cerus' news Wednesday, as its stock (NASDAQ:CERS) jumped 13.3 percent, a 47-cent gain to $4.
MedImmune's stock (NASDAQ:MEDI) rose 55 cents to $24.30, on reports of relatively flat net earnings for 2004's first quarter. The company recorded $111 million in earnings, or 44 cents per diluted share, compared to $110 million and 43 cents per share a year ago. Its EPS beat consensus forecasts by two cents.
The company said total revenues for the first quarter grew 13 percent over last year to $489 million. MedImmune attributed the growth primarily to increased worldwide sales of Synagis (palivizumab) to $422 million, up from $391 million reported in last year's corresponding quarter. The product is used to prevent serious lower respiratory tract disease caused by respiratory syncytial virus in pediatric patients.
The company also posted $31 million in revenues related to FluMist (influenza virus vaccine live, intranasal). MedImmune said discussions continue with Wyeth, its co-promotion partner for the flu vaccine that might end its role in further development and commercialization of the product.
The 1,800-employee company also markets two other products, Ethyol (amifostine) and CytoGam (cytomegalovirus immune globulin intravenous [human]). Ethyol is marketed for the reduction of both cumulative renal toxicity associated with repeated administration of cisplatin and moderate to severe xerostomia in patients undergoing post-operative radiation treatment. CytoGam is indicated for the prophylaxis against cytomegalovirus disease associated with transplantation of the kidney, lung, liver, pancreas and heart.
But the seasonality of Synagis and FluMist impacts MedImmune's earnings projections for the coming quarter, as both are used to combat viruses prevalent in the winter months. MedImmune forecasted an EPS loss for the second quarter to range from 13 cents to 16 cents, along with revenues ranging from $93 million to $98 million.
The company ended the quarter with $2 billion in cash and marketable securities, as well as about 250.9 million shares outstanding.
MedImmune's late-stage development programs include CAIV-T, a liquid formulation of FluMist. Madison, N.J.-based Wyeth has conducted Phase III studies of the refrigerator-stable product in more than 20,000 patients overseas, and Lacey said the companies are working to continue the program in the U.S. She said recently reported Phase III data showed statistically superior efficacy over a traditional flu shot in preventing culture-infirmed influenza in children.
London-based partner GlaxoSmithKline plc reported Phase II findings showing a human papillomavirus vaccine to be 100 percent effective in preventing persistent infections with the virus, which can cause cervical cancer. MedImmune's Vitaxin is in four Phase II studies for prostate cancer, melanoma, rheumatoid arthritis and psoriasis. Patient enrollment is complete in the latter two trials, and the melanoma study is expected to close enrollment this quarter.
"Hopefully, we'd be in a position to decide if and how to proceed to Phase III in 2005," Lacey said.