Atossa – A Play on Immunotherapy Cancer Agent CAR T

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If you haven’t heard about CAR T-cell immunotherapy (CAR T is the acronym for “chimeric antigen receptor T-cells”), you’re missing out on the early days of a novel, potentially transformative cancer-treatment modality. CAR T-cells, referred to by some researchers as “…a living drug”, are currently the focus of more than 200 clinical studies. In an evidence-based discipline such as immuno-oncology, the investment of so much time, energy and money ought to pique any investor’s curiosity.

CAR T-cell therapy builds on the advances of 60 years of immunotherapy research, but improves on past successes by introducing elements of modern cell therapy and genetic engineering. CAR T has proven itself strongly effective in clinical trials, and could well pave the way for a new era of individualized cancer treatment.

T-cells, a type of white blood cell, are an important component of the body’s immune system. CAR T-cells are created from T-cells that have been taken from the blood of a healthy donor, or from a cancer patient’s own blood. The collected T cells are genetically engineered to express the chimeric antigen receptor, which essentially reprograms T-cells to target and – and kill – the diseased cells associated with the patient’s specific cancer. Infused into the patient’s body, CAR T-cells rapidly proliferate to therapeutic levels, and can persist for years. If the early successes of CAR T-cell therapy continue, patients with a wide variety of cancers could enjoy significantly improved outcomes.

One of the small-caps we’ve been watching recently threw its hat into the CAR T-cell ring. Atossa Genetics Inc. (ATOS), a pure play pharmaceutical company developing novel therapeutics and delivery methods for treating and preventing breast cancer, is planning to use its intraductal microcatheter technology for transpapillary (TRAP) delivery of CAR T-cells that have been engineered to target and attack breast cancer cells. The genetically-modified CAR T-cells will be reintroduced to the patient through the natural ducts of the breast, using Atossa’s proprietary microcatheter. Atossa’s method has several potential advantages versus conventional oral dosing, including:

  • reduced toxicity by limiting systemic exposure;
  • improved efficacy through direct targeting;
  • lowered rates of metastasis, since the CAR-T cells introduced in this manner will move through the lymphatic system – the same path taken by migrating cancer cells;
  • reduced burden on payers, since intraductal delivery may require lower doses than systemic CAR T therapy.

Atossa is an interesting way to play the potential of CAR T therapies, because if CAR T therapies are able to live up to their promise, and if TRAP becomes the preferred delivery method for CAR T in certain indications, then Atossa could become a very attractive acquisition candidate. M&A in the CAR T space has already started to heat up. In August, 2017, Novartis received the first FDA approval for a CAR T cell therapy, Kymriah, for children and young adults with refractory B-cell Acute lymphoblastic leukemia (ALL). Less than two months later, Gilead Sciences (GILD) acquired Kite Pharma (KITE), a company focused on CAR T therapy, for a whopping $11.9 billion. In January of this year, Celgene Corporation (CELG) acquired Juno Therapeutics, Inc. (JUNO), a pioneer in the development of CAR T therapeutics, for approximately $9 billion. As the evidence for CAR T-cell therapy mounts, the trend toward industry consolidation will likely continue.

According to Global Market Insights, the American breast cancer therapeutics market was valued at more than USD$13 billion in 2016, and is expected to witness more than 9% CAGR from 2017 to 2024, with the lion’s share of the growth coming from targeted drug therapy.

Although Atossa is still a clinical stage company, it has several milestones coming this year which could prove to be catalysts. Those milestones include: opening a Phase 2 Study of oral Endoxifen (a very promising metabolite of Tamoxifen – one of the standards of care for breast cancer); opening the Phase 2 Study of topical Endoxifen to treat mammographic breast density (studies have shown that a reduction in MBD reduces the risk of developing breast cancer) and the continuation of a Phase 2 study administering Fulvestrant, an FDA-approved medication for metastatic breast cancer, with the company’s proprietary microcatheters.

We believe there’s a good chance that CAR T could become a stellar weapon in the fight against cancer, and anyone who shares that conviction should take a closer look at Atossa. It’s definitely one of our favourite small cap biotechs.

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