ImmunoCellular (IMUC.OB): Taking Aim at the Root of Cancer Print E-mail
Wednesday, 26 August 2009 08:37

ImmunoCellular Therapeutics (IMUC.OB) is an emerging cancer immunotherapy company that is developing therapeutic and diagnostic product candidates taking aim at the root cause of the disease, cancer stem cells (CSCs), based on two distinct technology platforms - active (cancer vaccines) and passive (monoclonal antibodies or mAbs). This approach is in the early stages of development, but has the potential to become a disruptive, paradigm shifting therapeutic approach to the treatment of cancer. CSCs are resistant to standard treatments such as chemotherapy and radiation, but numerous bio-markers on these cells have been identified which can be used to develop targeted mAbs and CSC immunotherapy products.

Although CSCs account for a small proportion of the cells in a given tumor, a growing body of scientific literature suggests CSCs drive the process of tumor growth and recurrence (even after the disease is undetectable and thought to be eradicated). Current therapeutic options such as radiation therapy or chemo target the proliferating cells, which form the bulk of any tumor mass while the CSCs lie dormant and unaffected at the root of the disease. Click here for a link to several overview articles on CSCs at MIT's Technology Review website.

The Company is developing an off-the-shelf (i.e. does not require obtaining cells from the patient as part of the manufacturing process) stem cell cancer vaccine (ICT-121) which targets a protein marker called CD133 which is typically expressed only on cancer stem cells and not on normal cells. CSCs are responsible for the prolific growth of primary and metastatic tumors and these cells must be eliminated for the complete eradication of a tumor to prevent recurrence of the disease (which may occur after months or years of being free of cancer).

While glioblastoma (GBM, a deadly type of brain cancer) will be the initial target for ICT-121, CD133 is also over-expressed in a wide variety of cancers such as colon cancer, breast cancer, liver cancer, prostate cancer, multiple myeloma and melanoma. In late June, IMUC announced an agreement with Formatech, Inc. to manufacture the Company's CSC vaccine product candidate (ICT-121) for an upcoming Phase 1 clinical trial in early 2010 targeting GBM. The deal includes a provision for Formatech to prepare the cancer vaccine vials for the clinical trial in a FDA-compliant GMP (Good Manufacturing Practices) environment.

The Phase 1 study for ICT-121 will involve 20 patients with GBM receiving five treatments each with final data from the trial anticipated after about 18 months (e.g. 3Q11), since the median time to recurrence in GBM patients is only 6.9 months. The Company is focusing on the following deadly forms of cancer which represent unmet medical needs with the following incidence of new cases each year according to American Cancer Society statistics for 2008: brain (21,800), small-cell lung (215,020), and pancreatic cancer (37,680). These cancers represent an unmet medical need with a 15% five-year survival rate for this trio, compared to a five-year survival rate for  breast cancer that is nearly 6X higher. A major problem is the recurrence of disease after initial treatment which is IMUC's target by focusing on residual disease (CSCs) following surgery in combination with standard radiation/chemo treatments.

IMUC uses peptides (the building blocks of proteins comprised of amino acid chains) in combination with another compound called an adjuvant to elicit a targeted immune response by T cells to destroy CSCs. This T cell response targets CSCs with a specific bio-marker (CD133 positive CSCs) that has been identified in a number of cancer types such as those outlined earlier. The goal of the Company's cancer vaccine approach is to combine conventional treatment(s) such as chemo or radiation with a product such as ICT-121 to target the residual CSCs to eliminate or delay the recurrence of cancer following treatment. The current treatment for brain cancer (GBM) typically involves a combination of surgery, radiation treatment, and chemotherapy which may lead to tumor cell DNA mutations or other changes leading to treatment-resistance and/or tumor recurrence.

At ASCO 2009, IMUC presented promising Phase 1 clinical data for ICT-107, which is the Company's dendritic cell-based cancer vaccine product candidate for the treatment of GBM (the most common and malignant type of brain cancer). The data presented at ASCO supplement the preliminary data from the completed study that IMUC initially reported in December 2008. The study enrolled 19 patients, including 16 with newly-diagnosed and three with recurrent disease. IMUC will seek a partnership to fund the future clinical development of ICT-107 as it focuses its resources on ICT-121 and cancer mAbs.

ICT-107 is the Company's patient-specific therapeutic cancer vaccine (in contrast to ICT-121 as an off-the-shelf vaccine) product candidate that consists of dendritic cells (immune system cells also referred to as antigen presenting cells or APCs that present molecules to the immune system to elicit a reaction) which are obtained from the patient's blood and programmed with tumor antigens which in turn provide a target for the immune system. Patients in the Phase I trial received three intradermal injections of ICT-107 at two-week intervals.

Seven of the 16 newly-diagnosed patients demonstrated stable disease with median progression-free survival of 64 weeks, and three of these seven patients have progression-free survival (PFS) exceeding two years, compared to the historical median PFS time of newly-diagnosed glioblastoma of just 30 weeks. ICT-107 was well tolerated with no significant adverse events (with no grade 3/4 adverse events and only mild side effects) reported in the study. Nine of the 16 newly-diagnosed patients had progressive disease with a median PFS of 39 weeks and median survival of 56 weeks. The three patients enrolled with recurrent disease exhibited disease progression, but still exhibited extended survival times of 34, 47, and 59 weeks.

Surasak Phuphanich, M.D., the principal investigator of the trial and a senior author of the ASCO presentation, stated that, "With a historical median PFS time of 6.9 months in GBM, we are encouraged to see a median PFS time of 14.2 months (57.5 weeks) in this newly-diagnosed glioblastoma (16 patients) population, and furthermore, it is exciting to see the correlation between immune response and survival given that the goal of ICT-107 is to elicit a cancer-specific immune response." A total of 15 patients in the trial were evaluated for immune responses, and six of them had a significant immune response to at least one tumor-associated antigen.

In early 2008, IMUC acquired a technology platform from Molecular Discoveries, LLC which referred to as DIAAD (Differential Immunization for Antigen and Antibody Discovery) for the rapid discovery of antigen targets to develop mAbs for the diagnosis and treatment of a wide variety of conditions with a focus on the detection and treatment of multiple myeloma, small cell lung cancer, pancreatic cancer, and ovarian cancer. The mAbs that IMUC acquired from Molecular Discoveries have been created to recognize certain bio-markers (antigens) which are highly specific to cancer cells and not expressed on normal cells to allow for the targeted treatment and detection of cancer cells.

The Company's mAb pipeline includes the following: (1) ICT-109 is a humanized mAb in development for the diagnosis of SCLC and pancreatic cancers; (2) ICT-037 is in preclinical development for therapeutic and diagnostic applications for colon cancer, ovarian cancer, and multiple myeloma; and (3) ICT-69 is in preclinical development for multiple myeloma and ovarian cancer.

The stock research section has recently been updated to include a research report for IMUC published by Griffin Securities on 4/27/09 with a buy rating and $2.50 price target (12-month) in addition to the most recent corporate presentation for the Company. The report presents both a discounted cash flow and transactions analysis models, which value IMUC shares at $2.50 and $3.10, respectively. On 8/18/09, IMUC's President and CEO, Manish Singh, Ph.D., presented an overview of the Company's business and strategy at the Southern California Investor Conference which I have uploaded in PDF format to provide a single file with all of the slides and images along with a link to the audio transcript from the event. Click here to visit IMUC's page on Facebook.

IMUC is also one of 10 components in the Mentor Capital Cancer Immunotherapy (CI) Index, which has posted a gain of about 23% since its inception six weeks ago. The equal-weight CI Index tracks the following stocks: Mentor Capital (MNTR.PK) (as a public-traded proxy for tracking Quantum Immunologics), Dendreon (NASDAQ:DNDN), ImmunoCellular Therapeutics, Antigenics (NASDAQ:AGEN), Biovest (BVTI.PK), Celldex Therapeutics (NASDAQ:CLDX), Oncothyreon (NASDAQ:ONTY), Northwest Biotherapeutics (NWBO.OB), CEL-SCI Corp. (AMEX:CVM), and Generex Biotechnology (NASDAQ:GNBT) ( as a proxy for its wholly-owned immunotherapeutic subsidiary, Antigen Express).

The CI Index is primarily a subset of my actively managed Cancer Diagnostic & Therapeutic (Dx/Tx) Micro-Cap Index, which reflects a cross-section of emerging cancer companies with market caps below $250 million at the time of index inclusion. In addition, Mentor Capital expects to update the CI Index on a weekly basis at its website.

As of the Company's most recent SEC 10Q filing on 8/14/09, IMUC had 14.65 million (M) shares of common stock outstanding, 9.7M options outstanding (at weighted average exercise price of $1/share or about 2X the current stock price of $0.55 as of 8/25/09), a market cap of $8M, zero debt, $2.3M in cash + investments, and a current cash burn rate of just $0.5M per quarter. In addition, IMUC has a strong intellectual property (IP) position, including seven issued patents and 17 pending applications that cover composition of matter, therapeutic treatments, and diagnostics related to CSC mAbs. Early next year (1Q10), IMUC expects to make an IND filing with the FDA for permission to begin human clinical trials for a Phase 1 study of its off-the-shelf cancer stem cell vaccine candidate (ICT-121).

The Company plans to raise $4-5M (sufficient to fund operations for 2.5 years) through a PIPE transaction with warrant coverage to fund Phase 1 trials of ICT-121 in GBM, pancreatic, and lung cancer; in addition to developing mAbs and additional vaccine candidates targeting CSCs. Any pending catalysts in the form of preclinical/clinical data, IND clearance to begin the Phase 1 trial for ICT-121, and development partnerships will have a major impact on IMUC given its low share count (less than 15M shares outstanding) and conservative valuation (market cap of about $8M) which ignores the Company's strong IP position as a pioneer in the emerging field of both active (vaccines) and passive (mAbs) immunotherapy product candidates focused on the root cause of cancer and its recurrence (CSCs).

Because of the very low cash burn rate of about $0.5M/quarter and $2.3M in cash + investments (sufficient to fund operations through at least mid-2010), IMUC has the luxury of waiting for higher stock prices before raising additional capital as the market becomes aware of the Company's prospects following expected catalysts before year-end that include partnership(s) for its CSC-targeting mAbs and feasibility data for ICT-109 in the detection of SCLC.  Beyond 2009, value-enhancing catalysts include preliminary clinical data for ICT-121 (e.g. immune response data), a potential partnership to fund further clinical development of ICT-107, the generation of additional CSC mAbs and vaccine product candidates, and additional partnerships for mAbs beyond the deal expected to occur before year-end.

Disclosure: Long IMUC.OB

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