Immutep — Encouraging results for efti and IMP761

Professor Frederic Triebel, Immutep’s chief scientific officer and chief medical officer, presented an update on the TACTI-mel study at the World Immunotherapy Congress 2019 (WIC) in San Diego in March. The presentation included initial efficacy data from the six-patient cohort, which comprises Part B of TACTI-mel. In this cohort, metastatic melanoma patients were treated with the efti (IMP321) soluble LAG-3 fusion protein in combination with Merck & Co’s Keytruda (pembrolizumab), with efti dosing starting at the same time as Keytruda, as shown in Exhibit 1.

Exhibits 2 and 3 show that three out of six (50%) patients achieved confirmed deep partial responses, including one patient with complete disappearance of all target lesions. A fourth subject achieved stable disease.

Efti/Keytruda combination treatment is ongoing for all four subjects who achieved either partial response or stable disease. These subjects have all received at least six months of treatment and the responses have been maintained throughout the treatment period.

No dose-limiting toxicities were observed, confirming that treatment with efti can safely commence at the same time as Keytruda.

Exhibit 4 shows the clear regression of lung and liver metastases six months after commencing efti/Keytruda combo therapy in one subject who had multiple lung, bone, liver and lymph node metastases.

Part B of the TACTI-mel study is the first cohort in which efti treatment began at the same time as Keytruda treatment. This means Part B provides the first data that are directly comparable to Keytruda monotherapy studies. Although the number of subjects is small, the response rate of three in six (50%) compares favorably to the response rate of 33% reported for the pivotal Phase III studies of Keytruda monotherapy in melanoma.

The response rate in Part B is particularly impressive given that all six subjects had very late-stage M1c disease (visceral metastases) and five out of six had elevated lactate dehydrogenase, which is an indicator of poor prognosis.

The presentation by professor Triebel at WIC also included an update on the 18 subjects in TACTI-mel Part A. In contrast to Part B, Part A efti/ Keytruda combination therapy was preceded by 12 weeks of Keytruda monotherapy. Subjects were assessed during the final cycle of Keytruda monotherapy and only subjects who had a suboptimal response to initial treatment with Keytruda were enrolled into the combination therapy study (Exhibit 5).

The response rate reported for TACTI-mel Part A was unchanged from previous reports, namely a 33% (six of 18) overall response rate (ORR) from the start of efti/Keytruda combination therapy, including one complete response. In an exploratory post hoc analysis, the ORR was 61% (11/18) when measured from the start of the 12-week Keytruda monotherapy screening period.

The updated data in Exhibit 6 show that the tumor responses following efti/Keytruda combination therapy were long lasting. To highlight the new data, we have added green circles to the response plots for selected patients to show the last data point included in the previous data set reported the Society for Immunotherapy of Cancer (SITC) in November 2018. None of the patients who achieved a tumor response (50% shrinkage) has experienced significant tumor growth during the period of follow up. Four subjects (three partial responders, one with stable disease) remain on the study.

Exhibit 7 summarizes the progress of the 24 individual subjects from both Parts A and B of the TACTI-mel study. A key feature to note is that eight subjects (four from Part A and four from Part B) are still progression free and under treatment. Five subjects so far have been treated for over 12 months, having achieved durable responses or an extended period of stable disease. No subjects terminated treatment due to safety issues with efti/Keytruda combination therapy, highlighting the good tolerability of the combination.

The company dosed the first patient in its TACTI-002 Phase II study in March and as of early April over 10 subjects had been enrolled. First data are expected in mid-2019.

TACTI-002 is evaluating efti plus Keytruda in up to 109 patients with non-small cell lung cancer (NSCLC) or squamous cell carcinoma of the head and neck (SCCHN) at up to 13 sites in Europe, the US and Australia. Treatment with efti (30mg by subcutaneous injection) commences on the same day as Keytruda treatment in this study, just like in TACTI-mel Part B. As of early March, recruitment had commenced at two sites in Australia, one site in the US and four sites in Europe. Immutep is conducting the study in collaboration with Merck & Co.

Patients will receive 12 months of efti/Keytruda combination therapy, followed by a further 12 months of Keytruda monotherapy (Exhibit 8).

The open-label TACTI-002 study will utilize Simon’s two-stage design. For each of the three treatment indications, an initial cohort of 17–23 patients will be treated. For each indication, if the number of patients with tumor responses exceeds a pre-specified threshold, additional patients will be recruited to take the total up to ~37 for that indication. The three target indications are:

The primary endpoint will be ORR (as per irRECIST). The TACTI-002 study data are intended to demonstrate that efti combo therapy can improve response rates to PD-1/L-1 therapy in a range of disease settings.

The AIPAC Phase IIb breast cancer study has recruited over 200 of the target of 226 subjects; the last subject is expected to be recruited in May or June 2019. The top-line event-driven PFS data are expected to report in Q419 or Q120 (after 152 PFS events).

The trial is testing efti combined with paclitaxel chemotherapy in women with hormone receptor positive metastatic breast cancer who have not previously received chemotherapy for metastatic disease. The European Medicines Agency has indicated that this trial could be sufficient to support a marketing authorization if it achieves certain (undisclosed) clinical endpoints. A confirmatory Phase III study would likely be required before filing for approval in the US.

Immutep recently presented encouraging results from preclinical studies that demonstrated the immunosuppressive activity of IMP761 in a non-human primate (cynomolgus monkey) animal model. The results were presented at the European Crohn’s and Colitis Organization congress held at Copenhagen, Denmark from 6–9 March 2019.

In the study, the monkeys were immunized with the BCG tuberculosis (TB) vaccine before being given a TB test. The TB test involves an intradermal injection of purified tuberculin protein to test for an immune response to the tuberculin protein. Following the first TB test, the monkeys were injected with IMP761 or a saline control then given a second TB test one to three days later, as shown in Exhibit 9, and the immune responses to the two TB tests were compared.

Exhibits 10 and 11 show that IMP761 reduced the infiltration of inflammatory cells, including cytotoxic T cells, into the tuberculin protein injection site.

In addition to demonstrating that IMP761 suppresses immune responses to tuberculin antigen in monkeys, Immutep has also shown it is active on human T cells. Exhibit 12 shows that IMP761 inhibits the proliferation and activation of human T cells in in vitro (cell culture) studies.

IMP761 is the first known therapeutic antibody with agonist properties that enable it to stimulate the LAG-3 receptor on the surface of activated T cells and thereby downregulate T cell activation and proliferation.

The key targets of IMP761 are memory T cells that have become ‘exhausted’ following prolonged activation and express high levels of LAG-3. Memory T cells are long lived and can quickly expand to large numbers of effector T cells when re-exposed to their target antigen (cognate antigen); they are believed to play a significant role in autoimmune disorders. IMP761 acts to reinforce the down-regulation of memory T cells by LAG-3.

The mechanism of action of IMP761 is different to the company’s IMP731/GSK2831781 (GSK’781) cytotoxic antibody, which aims to treat autoimmune disease by killing LAG-3 positive T cells (IMP731 is partnered with GSK). IMP761 offers the opportunity to fine-tune immune responses, which could benefit sufferers of autoimmune diseases by temporarily switching off activated LAG-3 positive T cells that are damaging tissue or causing inflammation.

Immutep has started cell line development for GMP manufacture of IMP761 to progress to clinical development. GMP manufacture and preclinical studies would be likely to take a further 18 months to complete, so initial clinical studies could potentially start in late 2020. One option would be to conduct initial PoC studies in psoriasis patients, because the impact of the treatment on psoriasis skin lesions can be readily assessed. This is the strategy that GSK followed for the initial clinical studies of GSK’781.

Immutep has not yet identified the preferred lead indication for IMP761, but potential candidate indications would likely include rheumatoid arthritis, ulcerative colitis, Crohn’s disease and psoriasis. These indications represent very large potential markets – AbbVie’s Humira, the leading treatment for autoimmune and inflammatory disorders, generated global sales of $19.9bn in 2018.1

According to the clinicaltrials.gov registry entry (NCT03893565), GSK expects to initiate its Phase II study of GSK’781 (IMP731) in ulcerative colitis this month. The study will investigate four dose levels of GSK’781 in 280 participants with ulcerative colitis. The clinicaltrials.gov entry lists a primary completion date of August 2021, although company announcements suggest that initial data could be reported in 2020.

Ulcerative colitis is a type of inflammatory bowel disease. Ulcerative colitis and Crohn’s disease are the most common types of inflammatory bowel diseases. The US Centers for Disease Control and Prevention estimates that the prevalence of ulcerative colitis is 0.24% of the population, which is equivalent to 780,000 patients in the US.

We model Immutep receiving a $6m milestone payment from GSK on the commencement of the Phase II study.

In September 2018 Immutep entered into a clinical trial collaboration and supply agreement with Merck KGaA/Pfizer to investigate the combination of efti with its anti-PD-L1 immune checkpoint inhibitor avelumab (Bavencio) in patients with advanced solid tumors. The study of avelumab plus subcutaneous (SC) efti in 12 patients with a range of advanced solid tumors will be included as arm 004 of the investigator-sponsored INSIGHT study (NCT03252938), which is underway at a single site in Germany. The avelumab combination therapy arm (INSIGHT-004) is expected to commence dosing patients in Q219 and to report first data before the end of 2019.

Our valuation of Immutep has increased to $409m (from $387m). We have rolled our model forward in time and included the FY19e net cash balance in our valuation (we previously used historic FY18 cash). The total number of shares in issue has increased to 3,384m due to the issue of 260m shares in the December 2018 placement. Due to the increase in the number of shares, value per share has declined to $12.10 per ADR (undiluted, vs $12.57 per ADR). On a fully diluted basis, our valuation is $8.79 per ADR (vs $9.05 per ADR), after taking into account the options, warrants and convertible notes in issue. Exhibit 13 summarizes the constituent parts of our valuation, which is based on a discount rate of 12.5%. Our other valuation assumptions remain unchanged. Our financial forecasts are broadly unchanged as we have incorporated the recent placement.

Exhibit 14 shows that in addition to the 3,384m Immutep shares in issue, there are a further 1,509m potential shares that could be issued on the exercise of options, warrants, performance rights and convertible notes, all of which would be in the money at our $12.10 per ADR undiluted valuation. Exhibit 14 shows that after taking into account these potential shares, our diluted valuation is $8.79 per ADR. Depending on trial progress and the timing of milestone payments from partners, Immutep may require additional funding to complete the efti clinical trials; our diluted valuation of $8.79 per ADR does not take into account the potential dilution from any future capital raising.

We include risk-adjusted milestones payable by current partners GSK for IMP731 and Novartis for IMP701, plus milestones from prospective deals for efti. The breadth of the LAG-3 pipeline means there could be further upside if Immutep or its partners launch additional products into the clinic or broaden the indications being studied.