At the mid-April American Association of Cancer Research Annual Meeting, bleeding-edge oncology company Instil Bio (NASDAQ:TIL) reported promising results for one of its candidate therapies.
In a compassionate-use program, the company’s tumor-infiltrating lymphocyte (TIL) therapy had an impressive overall response rate in an especially difficult-to-treat stage IV metastatic melanoma population. The $2.1 billion market cap biotech expects to begin a phase 2 trial of the treatment in the second half of 2021, with data to be delivered in 2023. Here’s what biotech investors need to know from this encouraging development and Instil’s potential.
Your immune system, but stronger
In TIL therapy, a biopsy is taken from a patient’s tumor. Then, the patient’s own immune cells that are recognizing and attacking the cancerous cells are isolated in a lab and compelled to reproduce so they multiply. Then these lymphocytes are infused back into the patient.
Unlike chimeric antigen receptor T-cell (CAR T) therapies, in which a patient’s immune cells are altered to recognize a specific protein on cancer cells, TIL therapies target multiple sites on a tumor, individualized to the molecular signature of the patient’s own tumor. While CAR T-cell therapy has only demonstrated success in liquid tumors such as lymphoma, leukemia, and multiple myeloma, TIL can also target solid organ cancers such as lung, cervical, and head and neck cancers.
Encouraging results so far
For recurrent advanced metastatic melanoma that has failed first-line treatment, overall response rates for treatments range from 4% to 22%, with overall survival of just seven to eight months. Under the compassionate-use program, Instil Bio treated 21 patients with ITIL-168, the company’s lead TIL therapy. In heavily pre-treated patients, ITIL-168 produced an overall response rate of 67%, including four patients (19%) who achieved a complete response. With significantly improved overall survival — 21.3 months, better overall response rates, and even a chance at a complete response, this early-stage biotech has captured a lot of investors’ attention.
The company plans to submit an Investigational New Drug application to the Food and Drug Administration (FDA) if ITIL-168 achieves positive results in its phase 2 trial. Then its submission for FDA approval could come as early as 2023 if everything goes well.
Instil Bio’s market opportunity
While perhaps not a perfect analogy, Gilead Sciences‘ (NASDAQ:GILD) Yescarta, a CAR T-cell therapy for patients with certain types of blood cancer, is probably the closest available cost comparison. Both CAR T-cell and TIL therapies require a significant amount of processing prior to being administered to patients. A one-time treatment with Yescarta costs $373,000, according to drugs.com. Given that there are roughly 7,000 deaths from melanoma annually in the U.S., that adds up to a $2.6 billion addressable market for ITIL-168, which is pretty sizable for a small biotech.
Weighing the competition
While metastatic melanoma patients are in need of additional treatments and Instil’s therapy shows promise, Instil Bio is not the only horse in the TIL stable. Last year, Iovance Biotherapeutics (NASDAQ:IOVA) revealed phase 2 data for its lead TIL therapy, also in patients with metastatic melanoma. However, that therapy demonstrated an overall response rate of 36%, a far cry from Instil’s 67%. While it did take Instil Bio eight years to treat 21 patients and it isn’t expecting to deliver follow-up data until 2023, pivotal phase 3 data for Iovance is expected later this year.
Even though Iovance may have a head start, if follow-up trials for ITIL-168 have results similar to its compassionate use data, Instil Bio just might be able to take the lion’s share of this $2.6 billion annual market. With just over $240 million in cash and cash equivalents, Instil Bio believes it has enough cash to last it into 2023.
Both companies have demonstrated remarkable efficacy against a difficult-to-treat disease with treatments that have similar mechanisms. While Instil Bio has stronger data, the timeline for ITIL-168 lags Iovance’s therapy.
Fortunately, the market is large enough so that it can support both therapies. Biotech investors may get excited about the promise of new treatments, but it is always necessary to remember that many treatments miss their targets in clinical trials and fail to earn regulatory approval. For those risk-tolerant biotech investors looking to get exposure to the promise of TIL therapies, a basket approach may be the best bet.
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