Kite Pharma KITE announced that it has entered into a strategic partnership with Daiichi Sankyo to develop and commercialize axicabtagene ciloleucel (KTE-C19) in Japan.
In another press release, Kite Pharma declared that it has formed a joint venture – Fosun Pharma Kite Biotechnology Co., Ltd. – with Chinese pharma company Fosun Pharma to develop, manufacture and commercialize axicabtagene ciloleucel in China.
Kite Pharma’s share price has declined 0.4% in the past one year compared with Zacks classified Medical-Biomedical and Genetics industry’s fall of 13.6%.
Daiichi Sankyo will pay $50 million upfront to Kite Pharma. Meanwhile, Kite Pharma will be entitled to receive future payments up to $200 million for the development and commercial milestones. The company is also entitled to receive sales royalties in the low to mid-double-digit range along with providing some technical services to Daiichi Sankyo.
According to the deal, Daiichi Sankyo also plans to license additional Kite Pharma product candidates in Japan including KITE-718, a TCR candidate targeting MAGE in a solid tumor, and other product candidates for which the company can file an investigational new drug application over the next three years.
Regarding the deal in China, the name of the joint venture company is subject to the approval of the relevant registration authorities. This joint venture will also have the option to include two T cell receptor (TCR) product candidates (KITE-439 and KITE-718) from Kite Pharma.
According to the joint venture agreement, Fosun Pharma will provide the RMB equivalent to $20 million in funding for the development/manufacturing activities and Kite will provide some technical transfer services to the joint venture. The company will share 40% of profits and the remaining 60% will be shared by Fosun Pharma. It will receive an upfront payment of $40 million from the venture.
Axicabtagene ciloleucel is Kite Pharma’s anti-CD19 chimeric antigen receptor (CAR) T cell therapy.
In December 2016, Kite Pharma initiated a rolling submission of the Biologic License Application (BLA) for axicabtagene ciloleucel, to the FDA. A rolling submission will allow Kite Pharma to submit portions of the regulatory application to the FDA as and when they are completed. The BLA is for the treatment for patients with relapsed/refractory aggressive B-cell non-Hodgkin lymphoma (NHL), who are ineligible for autologous stem cell transplant (ASCT).
The rolling submission is expected to be completed by the end of the first quarter of 2017. If approved Axicabtagene ciloleucel, is expected to be launched in 2017. The regulatory filings for axicabtagene ciloleucel in Europe will be done in 2017.
We note that the development of CAR T cell therapies has been attracting a lot of attention lately with several companies eyeing this field. Juno Therapeutics Inc. JUNO is also working on developing therapies utilizing the CAR T cell technology. In fact, interest in immunotherapy is building up fast.
The basic concept of cancer immunotherapy or immuno-oncology is to utilize certain parts of the immune system to fight the disease. This can be done by stimulating the immune system to attack cancer cells or by introducing immune system components into the body.
Merck & Co., Inc.’s MRK anti-PD-1 therapy, Keytruda, is being studied for more than 30 types of cancers. Amgen’s AMGN Blincyto, a BiTE antibody, gained earlier-than-expected FDA approval in Dec 2014. Blincyto has the potential to be developed for other hematologic malignancies as well.
Kite carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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