Pipeline overview: Clinical development in sight
Nuevolution has numerous publicly announced programmes alongside up to 10 earlier-stage undisclosed programmes in various stages from screening to hit validation and early hit optimisation. Of the main pipeline, the RORγt inverse agonist and the BET-BD1 programmes are the most advanced: earlier-stage assets including cytokine X and GRP78 continue to progress well. Based on Nuevolution’s own guidance, we anticipate the RORγt inverse agonist and the BET-BD1 programmes will be ready to enter the clinic in 2019 following the successful completion of IND-enabling studies. Exhibit 1 highlights Nuevolution’s development pipeline.
Exhibit 1: Nuevolution’s development pipeline
Indication |
Stage |
Target |
Ownership |
Notes |
Chronic inflammatory diseases |
Preclinical |
RORγt inverse agonist |
Partner Almirall in dermatology and psoriatic arthritis. |
RORγt plays an important part in the generation of mature T-cells and the subsequent production of cytokines, notably IL-17. IL-17 is a key pro-inflammatory cytokine that plays a role in multiple inflammatory and autoimmune conditions and in certain circumstances cancer. Injectable antibodies against IL-17 have demonstrated good efficacy for treatment of psoriasis in humans. Nuevolution’s RORγt inverse agonists are oral-based therapeutics that offer the ability to down regulate IL-17. The lead candidate is partnered with Almirall for dermatology and psoriatic arthritis. Clinical development in dermatology is expected to commence in 2018. |
Other indications 100% ownership NUE |
Nuevolution retains rights to other non-dermatological indications. Ankylosing spondylitis (AS) is the priority indication with inflammatory bowel diseases (IBD) as a secondary. Completion of Kg scale-up is expected shortly with in vivo efficacy in AS mouse model anticipated in H118. IND-enabling studies are anticipated to start in Q218 with clinical readiness by early 2019 possible. |
Inflammatory diseases |
Discovery: lead optimisation |
BET bromodomain inhibitors |
100% ownership NUE |
The BET sub-family of bromodomains is a novel biological disease target class offering a new mode of action for treatment of cancer and inflammatory diseases. Atopic dermatitis (AD) and/or psoriasis have been selected as the primary indication with secondary indications in fibrosis (Scleroderma) and systemic lupus erythematosus. The nomination of a lead candidate is expected to occur during Q218 with the programme potentially reaching clinical readiness by mid-2019. |
Inflammatory diseases |
Discovery: hit-to-lead |
Cytokine X |
100% ownership NUE |
The cytokine X (target undisclosed) programme continues to optimise lead product candidates. In H217, a NUE selected molecule demonstrated comparable efficacy to that of an antibody for the same target in a mouse model. The cytokine X programme looks to offer tablet-based replacement for currently available but costly injectable medicines. |
Cancer |
Discovery: hit-to-lead |
GRP78 |
50% ownership* |
GRP78 is a member of the chaperone family of proteins; it is over expressed in many tumour types including breast cancer and brain tumours. Selected compounds are now in the control of CRT/ICR and further progression is reliant on them. |
Cancer |
Discovery: hit optimisation |
RORγt agonist (inhibition) |
100% ownership NUE |
RORγt agonists may provide the immune system with a novel tumour attacking mechanism. Nuevolution continue to probe the mechanism of action for its lead product candidates. |
Various |
Discovery: various |
Various |
100% ownership NUE |
10+ discovery programmes in a range of undisclosed indications including oncology, inflammatory diseases and immuno-oncology. |
Source: Nuevolution, Edison Investment Research. Note: *Collaboration with CRT and ICR.
RORγt inverse agonist: Focus on ankylosing spondylitis
RORγt is an important master control switch of immune system activation and a potential novel target for the treatment of autoimmune diseases (by immune suppression) and cancer immunotherapy (by immune activation). RORγt plays a critical role in the generation of mature T-cells, particularly Type 17 effectors that produce an array of cytokines, notably IL-17A (IL-17A enables the recruitment of key immune components to sites of inflammation).
Nuevolution has retained the rights to develop the RORγt inverse agonist (inhibitor) in indications not covered by the Almirall deal and has chosen ankylosing spondylitis (AS) as a lead indication with inflammatory bowel disease (IBD) as a secondary indication. Nuevolution expects to complete kg production of the active pharmaceutical ingredient (API) in Q118 which should enable the start of investigational new drug (IND) enabling safety studies in Q218. Following satisfactory completion, Nuevolution would be in a position to submit an IND application to the US FDA, or Clinical Trial Application (CTA) to EMA, potentially preparing for clinical development by early 2019. Targeting of IL-17 in the treatment of AS has been validated by the approval of Novartis’ Cosentyx (secukinumab) which remains the only IL-17 approved antibody in AS. However, we note this could quickly change, as Lilly’s IL-17 antibody Taltz (ixekizumab) has recently reported top-line positive Phase III results in radiographic axial spondyloarthritis (a broader definition of patients then AS that includes patients with or without characteristic inflammatory changes in the sacroiliac joints) and plans to submit for regulatory approvals later in 2018. A RORγt inhibitor which plays a critical upstream role in preventing the generation of IL-17 producing T-cells should, in theory, be able to produce a comparable effect to these antibodies although this has yet to be clinically validated.
Ankylosing spondylitis: Large, unmet commercial opportunity
Ankylosing spondylitis (AS) is a chronic inflammatory arthritis predominately affecting the spine and sacroiliac joints. Over the course of time chronic inflammation of the spine (spondylitis) can lead to a complete fusion of the vertebrae (ankyloses) and loss of mobility of the spine. AS is associated with systemic manifestations such as neurological, renal and cardiovascular disease.
Spondyloarthritis refers to a group of inflammatory diseases that cause arthritis or joint inflammation. AS is the most common but other types include psoriatic arthritis, reactive arthritis, enteropathic arthritis and juvenile enthesitis related arthritis. 90% of individuals diagnosed with ankylosing spondylitis are HLA- B27 (human leukocyte antigen - B27) gene positive. However, it is not the sole driver of the disease as the majority of patients who are HLA-B27 do not go on to develop AS. Those that do are known to have an earlier onset in comparison with those who are HLA-B27 negative.
Prevalence varies by country and is correlated to HLA B27 gene; the higher the HLA-B27 prevalence the higher the AS prevalence; there is great variability between ethnic, racial and geographic variation (David and Lloyd 1999). The prevalence of ankylosing spondylitis is 0.1% to 1.4%, depending on the population studied.
Medical management of AS has historically been centred on symptomatic treatment to reduce pain and inflammation (eg NSAIDS, sulfasalazine, methotrexate, corticosteroids). The advent of biologic therapies has led to the approval of treatments that target pro-inflammatory excess cytokines. Approved treatments include:
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TNF-inhibitors: Humira (adalimumab), Remicade (infliximab), Simponi (golimumab), Cimzia (certolizumab) and Enbrel (etanercept).
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IL-17 inhibitors: Cosentyx (secukinumab)
Novartis’ Cosentyx (secukinumab) is the first and thus far only IL-17 inhibitor approved for AS. It received FDA approval in January 2016. It is an IL-17 inhibitor (antibody IV treatment) that is also approved for PsO (psoriasis) and PsA (psoriatic arthritis). Novartis reported combined sales of $2.1bn across all three indications in FY17, its second full year of launch. Cosentyx offers an alternative treatment option for patients who are not responding to TNF-inhibitors or are unable to cope with their side-effect profiles. However, like the TNF-inhibitors, it carries a risk of increased infections. In clinical trials, it was shown to exasperate or cause new inflammatory bowel disease in a very small proportion of patients.
If a RORγt inhibitor is to succeed both clinically and commercially it will likely need to demonstrate comparable efficacy and safety to that of Cosentyx. In its registration studies, Cosentyx demonstrated a 33% absolute improvement over placebo (61% vs 28%) in the number of patients who had an ASAS20 response, which is defined as a patient who has had an improvement of 20% in at least three of either: patient global assessment, pain assessment, function and inflammation. It additionally demonstrated a 25% absolute improvement over placebo (36% vs 11%) for the number of patients who achieved an ASAS40 response (defined as ASAS20 but for a 40% response). On the back of Cosentyx’s success and the likely approval of Lilly’s Taltz in AS later this year, we believe that Nuevolution’s RORyt small molecule oral inhibitor (that operates upstream of IL-17) could have a significant place in the market if it provides comparable efficacy and safety.
On consensus estimates (EvalutePharma) the total worldwide market is worth potentially $2.2bn by 2022, up c 38% vs 2016 sales of $1.6bn. The majority of this value is expected to continue to be driven by blockbuster biologics Humira (AbbVie) and Cosentyx (Novartis). Novartis estimates that in the US alone there are currently 1.13m patients with AS, of which roughly half are diagnosed (520,000). Of those diagnosed, 85% go onto treatment (440,000) while a further 19% of these ultimately end up receiving biologics (84,000). In our view, the market would be very receptive to a competitively priced oral RORγt inhibitor that has comparable efficacy and safety to IL-17 antibodies. The ability to capture a small percentage of this market could be transformational for a company of Nuevolution size. However, we note any such sales are at least several years off, assuming any compound is clinically successful.
Competitive RORγt inverse agonists interest focused on psoriasis
We have reanalysed and updated our overview of the RORγt inverse agonists competitor space (Exhibit 2). Multiple competitors continue to advance, however, most are predominately focused on psoriasis indication (please see our previously published initiation note Chemetics proof is in the deal making for a detailed description of the disease) which could enable Nuevolution to gain ground in AS and IBD. However, we note success for Nuevolution in these indications would validate both target and indication and would likely lead to increased competition.
While Nuevolution’s internal focus is on AS and IBD, the out licensing of Nuevolution’s RORγt inverse agonists to Almirall in psoriatic arthritis and dermatological indications means Nuevolution will likely have an indirect presence in the psoriasis indication. However, Almirall’s exact clinical indication has not yet been announced publically, although we expect the company to provide an update this year.
One of the most advanced RORγt inverse agonists is AGN-242428 in Phase II development by Allergan (through the acquisition of Vitae Pharmaceuticals for $639m in cash). Allergan has initiated a RORγt Phase II study in psoriasis and a Phase III trial is expected to initiate in 2020. In May 2016, Vitae Pharmaceuticals reported top-line results from its Phase IIa clinical trial testing its small molecule RORγt inverse agonist (VTP-43742) in psoriatic patients. In the low dose cohort (350mg), VTP-43742 reported a 23% improvement in the Psoriasis Area and Severity Index (PASI) score at day 28 from baseline (p<0.015), which compared favourably to a 1% deterioration for patients on placebo. Patients on the higher dose cohort demonstrated a 29% improvement from baseline at day 28 (p=0.003). There were no reported serious adverse events at all dose levels. At the highest dose tested (700mg), reversible transaminase elevations (results in liver toxicity) were observed in 5/34 patients. No dose limiting toxicities were seen in any of the Phase Ia, Ib and IIa trials. In the Phase Ib trial, some nausea and headache were observed at the maximum dose of 1,400mg, although it was not dose limiting. These are the first Phase II data to confirm the validity of RORγt as a drug target for the treatment of psoriasis.
Exhibit 2: RORγt inverse agonists in development
Drug |
Company/partner |
Delivery |
Status |
Indication(s) |
Notes |
Development programme |
Nuevolution/ Almirall |
Oral |
Preclinical |
Almirall: dermatology and psoriatic arthritis indications. Nuevolution: Other indications. Most advanced in AS. |
Signed in December 2016. Deal contains €172m (SEK1.7bn) in development and regulatory milestones, €270m (SEK2.6bn) in commercial sales milestones and tiered royalties on future net sales. Nuevolution received €11.2m (SEK109m) gross as an upfront licence payment (before the Spanish withholding tax of SEK20.9m). Nuevolution retains the right to develop RORγt inverse agonist compounds outside of the Almirall indications (in dermatology and psoriatic arthritis indications). Nuevolution has prioritised ankylosing spondylitis as its lead indication with inflammatory bowel diseases as secondary. |
AGN-242428 |
Allergan |
Oral |
Phase II |
Psoriasis |
Allergan, through the acquisition of Vitae Pharmaceuticals for $639m, is developing AGN-242428, an oral RORγt inverse agonist (previously known as VTP-43742). In an ongoing Phase II trial which is expected to read out in September 2019. |
GSK-2981278 |
GSK |
Topical |
Phase II |
Psoriasis |
Has completed a Phase II and Phase I trial for the topical treatment of plaque psoriasis. At its Q217 results (and confirmed recently at FY17 results), GSK announced it will terminate, partner or divest GSK-2981278. |
AZD-0284 |
AstraZeneca |
Oral |
Phase I |
Psoriasis |
Phase I study in plaque psoriasis vulgaris has completed in healthy patients. A Phase I ongoing in moderate to severe psoriasis patients with data expected in the summer. The trial is a randomised, double blind, placebo controlled study and is expected to enrol 25 patients with initial data expected in the summer. |
ARN-6039 |
Arrien Pharmaceuticals/ Boston Pharmaceuticals |
Oral |
Phase I |
Autoimmune disorders |
In June 2017, Arrien announced a worldwide licence agreement with Boston Pharmaceuticals. The agreement covers development in psoriasis and other autoimmune disorders. The deal includes an undisclosed upfront, development milestone, sales milestone and royalties on net sales. ARN-6039 (BOS172767) has completed a Phase I trial, while a Phase II trial is believed to have recently initiated. |
JTE-451 |
Japan Tobacco |
Oral |
Phase I |
Psoriasis |
As of 6 February 2018 it is in a Phase I trial. Previously had JTE-151 in development, which had been terminated as of 2 May 2016. |
Development programme |
Phenex Pharma/ Janssen |
Oral |
Phase I |
Autoimmune disorders |
Development programme with Janssen worth up to $135m. In June 2017, Phenex announced the payment of a $6m milestone payment from Janssen for the initiation of Phase I trial with a RORγt inverse agonist. |
BBI-6000 |
Orca Pharmaceuticals/ Brickell Biotech |
Topical |
Preclinical |
Psoriasis |
Acquired worldwide rights from Orca in November 2015 for a series of topical RORγt inhibitors (undisclosed deal terms). Company expects to complete IND enabling studies in 2018 and to initiate a proof-of-concept clinical trial in psoriasis (topical) by the end of 2018. |
LYC-56056 |
Lycera |
Oral |
Preclinical |
Autoimmune disorders |
LYC-56056 is currently in preclinical development. |
INV-17 |
Innovimmune Biotherapeutics |
Oral |
Preclinical |
Psoriasis |
Most recently presented preclinical psoriasis data (topical treatment) at the 2017 European Academy of Dermatology and Venereology (EADV) annual meeting in Geneva. |
IMU-366 |
Immunic Therapeutics |
Oral |
Preclinical |
Psoriasis |
A Phase I in psoriasis is being planned/in preparation. Out licensed from 4SC in September 2016. |
N/A |
Escalier Biosciences |
Oral/ Topical |
Preclinical |
Autoimmune disorders |
Completed a $19m series B financing round in March 2018. It anticipates the topical compound to enter the clinic by mid-2018. |
Development programme |
Lead Pharma/Sanofi |
Oral |
Preclinical |
Autoimmune disorders |
Signed February 2015. Undisclosed deal value. Plan to be in clinical trials within three to four years of starting the research collaboration. Lead Pharma received an upfront payment and is eligible to receive milestones on research, development, regulatory and commercial progress. Sanofi is responsible for commercial development. Lead Pharma has to date received three undisclosed milestones from Sanofi, most recently in November 2017. |
Development programme |
Exelixis/ Bristol-Myers Squibb |
Oral |
Unknown |
Autoimmune disorders |
Joint discovery programme. Research period with Bristol-Myers Squibb (BMY) has ended, BMY now has had sole responsibly for its development. |
Development programme |
Karo Pharma/ Pfizer |
Oral |
Unknown |
Autoimmune diseases |
Signed a deal in December 2011 to develop new treatments for autoimmune diseases based on RORγt. Karo is entitled to milestones of over $200m plus royalties on sales. In May 2017 it received a $2m milestone from Pfizer. |
Source: Edison Investment Research
BET BD1: Clinically ready in 2019
Nuevolution’s second lead internal programme is focused on the first bromodomain (BD1) of the bromodomain and extra-terminal domain (BET) family of proteins. The company has prioritised atopic dermatitis and/or psoriasis as its lead indication while fibrosis (IPFand Scleroderma) and systemic lupus erythematosus are secondary indications.
Both atopic dermatitis (commonly referred to as atopic eczema) and psoriasis are inflammatory conditions which manifest themselves as dry, scaly skin over the body and in extreme cases cracked raised lesions. Atopic dermatitis is commonly treated with topical corticosteroids and antihistamines. In severe cases, more advanced specific therapies are utilised including targeted biologic therapies like Sanofi’s IL-4 antagonist Dupixent (dupiliumab) and Pfizer’s PDE-4 inhibitor Eucrisa (crisaborole). Psoriasis treatment often depends on the severity of the disease and co-existence of arthritis. Treatments much like for atopic dermatitis often include topical treatments like corticosteroids in addition to light therapy and general immunosuppressants (eg cyclosporine and methotrexate). Specific biologics like Abbvie’s Humira (adalimumab), J&J’s Stelara (ustekinumab) and Novartis’ Cosentyx (secukinumab) are utilised in the most severe cases. Both are significant indications with consensus forecasts for psoriasis and atopic dermatitis worldwide sales in 2022 of approximately $20bn and $6bn respectively (EvaluatePharma). A BET-BD1 inhibitor offers a potentially novel mechanism of action that could attract patients who have failed other classes of therapy.
The most advanced molecules in Nuevolution’s BET-BD1 programme are NUE7770 and NUE19796, although additional compounds are still being investigated. In Q218, Nuevolution anticipates nominating the lead candidate to move forward to clinical readiness. In H217, Nuevolution demonstrated in vivo efficacy in multiple inflammatory mouse models. These included a psoriasis/atopic dermatitis model (IL-23 induced ear edema), a collagen-induced arthritis (IL-17) model and a fibrosis model. In a separate in vitro model (Exhibit 4), Nuevolution demonstrated that its compounds could inhibit the chemokine, CCL2 produced from stimulated skin cells (keratinocytes). CCL2 (C-C motif ligand 2) also known as MCP1 (monocyte chemoattractant protein 1) is a cytokine that is known to generate a pro-inflammatory response by recruiting a range of immune components including monocytes, T-cells and dendritic cells.
Exhibit 3: Inhibition of CCL2 produced by IL13/IFNγ stimulated cells by Nuevolution’s BET-BD1 inhibitors
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We note that numerous BET inhibitors are in development (mainly targeting oncology indications). However, the most advanced clinical candidates are generally non-specific in nature and target the majority of BET proteins. Some of the most advanced BET inhibitors are Apabetalone from Resverlogix (Phase III), BMS-986158 (Phase I/II) from Bristol-Myers Squibb, GS-5829 (two ongoing and one completed Phase I/II trials) from Gilead, INCB057643 (Phase I/II) from Incyte and GSK525762 (Multiple Phase II trials in a range of cancers) from GSK. None of these product candidates are in development for inflammatory conditions, likely as result of their range of toxicities which are not as accepted outside of oncology indications. Nuevolution’s selective BET-BD1 inhibitor programme aim to demonstrate a significantly improved clinical profile compared to current BET-BD1 inhibitors due to the selectivity of the inhibition. However, until clinical safety data are available, this is only theorised based on preclinical data.
Rest of the pipeline ready to move out of the shadows
While the RORγt inverse agonist and BET-BD1 programmes continue to lead internal development, the RORγt agonist, Cytokine X and GRP78 programmes in addition to 10 + undisclosed programmes continue to progress through various stages of discovery (Exhibit 1). Every programme in the pipeline is being developed utilising Nuevolution’s Chemetics platform.
One of the most advanced is the RORγt agonist programme for use in immune-oncology. While the inverse agonist product candidates aim to dampen an immune response, the agonist product candidates aim to boost an immune response. In the second half of 2017, Nuevolution conducted an in vivo study in a mouse breast tumour model, where it compared the efficacy of a lead internal compound with a competitor with claimed in vivo activity. The study aimed to help develop the understanding of the mechanisms of action at play. Neither Nuevolution’s nor the competitor’s compounds had an effect. This could indicate either a failure in the model or a failure of the compounds, however, this is expected at this stage of development as multiple models and compounds are tested in order to refine their suitability towards the target disease. Additional RORγt agonists have been identified by Nuevolution and the company aims to further probe the mechanism of action with more tumour models.
Currently the most advanced clinical RORγt agonist product candidate is LYC-55716, in development by Lycera. The company has a Phase I/IIa study in patients with advanced solid tumours, the Phase I component is now complete and patients are currently being enrolled into the Phase IIa with full patient enrolment expected by mid-2018. Most recent efficacy data from the Phase I component of the trial was presented at ESMO 2017, please see our note Defining year as partnerships progress on track for further details. In addition to the aforementioned trial, Lycera has recently initiated a Phase Ib study in patients with metastatic NSCLC in combination with the PD-1 checkpoint inhibitor pembrolizumab (Keytruda). The aim is to enrol 18 patients with data expected in the first half of 2019.
In the Cytokine X programme (exact target undisclosed), progress is advancing as anticipated. In H217, Nuevolution continued lead optimisation of the programme, with the intention of improving compound exposure levels in animals and exploring other chemical series that have not yet been studied. In one mouse inflammation model (Exhibit 5) Nuevolution’s compound demonstrated efficacy at the highest concentration on a par with an antibody to the same target. The efficacy of the NUE compound was compared to the antibody, where the antibody is at 100% inhibition. Both were tested mid study and at end study, with the undisclosed disease worsening throughout the study. All compounds were dosed twice daily by a sub-cutaneous injection under the skin.
Exhibit 4: In vivo mouse inflammation model, NUE compound vs antibody to same target
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While the exact target is undisclosed, we note inhibition of cytokines by small molecules has never reached commercial approval. Various antibody based inhibitor cytokines do exist, but if Nuevolution can successfully develop a small molecule cytokine inhibitor, it could provide substantial benefits over antibodies, including lower costs, easier administration (oral rather than injection as is the case with antibodies) and better control over side effects due to the typically shorter circulating lifetime of small molecules.
The GRP78 programme is being conducted in collaboration with Cancer Research Technology (CRT) UK and the Institute of Cancer Research (ICR) UK. The programme aims to identify compounds that target GRP78, an intracellular protein that is believed to support cancer cell survival. Compounds that have been selected by Nuevolution are now in the control of CRT/ICR where they are being tested in various cancer cell lines. Further progression of this programme will depend on CRT/ICR.
We note that multiple other undisclosed programmes are in development by Nuevolution and we anticipate these will come to the forefront as the lead assets are either out licensed or clinically developed internally.