Celgene opts in on Juno’s early-phase CAR-T therapies for $1bn upfront.
By Zachary McLellan, Analyst
2 July 2015
I am an oncology analyst at Datamonitor Healthcare based in the New York office. I joined Datamonitor in June 2015 while...
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On 29 June 2015, Celgene and Juno Therapeutics announced a global collaboration for the development and commercialization of chimeric antigen receptor T cells (CAR-T) and T-cell receptor (TCR) immunotherapies for cancer and autoimmune diseases. Celgene’s blockbuster investment shows it is more confident in Juno’s early-stage CAR-T candidates than it was in bluebird bio’s candidates, which Celgene dropped in June 2015. CAR-T therapies represent a promising area of immuno-oncology, with early data from Juno’s CAR-T therapies demonstrating efficacy in hematological cancer types. However, data from larger studies will be needed to establish efficacy and address safety concerns.
The terms of the 10-figure deal stipulate that Celgene will make a $150m cash payout to Juno and will purchase approximately 9.1 million shares of Juno stock at $93.00 per share, double that of Juno’s 29 June closing share price of $46.30. The premium price paid enables Celgene to opt in on anything from Juno’s pipeline. Juno will retain commercial and development rights to its CAR-T therapies in North America, while Celgene has obtained exclusive rights in other world markets with the proviso that Juno will be paid royalties on any sales of future marketed products. Celgene will have the option to purchase more equity in Juno, up to a maximum stake of 30% over the course of the 10-year agreement. Celgene also has the right to nominate a member to Juno’s board of directors, and Juno will receive 30% of revenues from any future T-cell therapies Celgene may develop (Celgene press release, 2015).
Juno Therapeutics is a Seattle-based biotechnology company that specializes in CAR-T and TCR immunotherapies. The company’s stated goal is to revolutionize medicine through the re-engagement of the body’s immune system in fighting cancer. It was founded in 2013 after licensing technologies originally developed by the Fred Hutchinson Cancer Research Center in Seattle, the Seattle Children’s Research Institute, and the Memorial Sloan Kettering Cancer Center (MSKCC) in New York. Juno went public on 19 December 2014, grossing $304.8m from its initial public offering.
CAR-T cells are personalized immunotherapies that work by modifying T cells from a patient’s own immune system so that the T cells are able to recognize and attack cancerous cells. CAR-T cells are made by taking T lymphocytes from a patient via leukapheresis and infecting the patient with a viral vector that contains a gene for the chimeric TCR. The vector encodes for a single-chain variable fragment (scFv) of a monoclonal antibody which recognizes tumor cells and one (or multiple) signaling domains responsible for subsequent T-cell activation, proliferation, survival, and cytokine production. The newly formed CAR-T cells are able to recognize tumor cells via the scFv and are reintroduced to the patient for treatment.
Juno’s current generation of CAR-T therapies include JCAR014, JCAR015, and JCAR017. All three of these CAR-T cells have short-chain variable domains that recognize and bind to CD19. CD19 is a cell surface protein that is expressed in the majority of B-cell leukemias and lymphomas, making it an attractive therapeutic target. Juno’s CAR-T cells also utilize a co-stimulatory domain derived from either CD28 (JCAR014, JCAR015) or 4-1BB (JCAR017) to enhance signaling in addition to the first-generation CD3ζ signaling domain. JCAR014 and JCAR017 are composed of a defined ratio of CD4+ and CD8+ T cells, whereas JCAR015 is made up of CD3-enriched peripheral blood mononuclear cells.
Juno is currently working on future generations of CAR-T technology that will likely include a second scFv fragment expressed on the T cell that can amplify or inhibit the signal, depending on how it is engineered. A second recognition site could be used as an inhibitory CAR that recognizes a protein present on healthy cells. When this CAR recognizes and binds to the protein, it inhibits T-cell activation and signaling so that it does not harm the healthy cell. Similarly, Juno is developing a secondary CAR that amplifies T-cell activation signaling only when it recognizes its target on potentially tumorigenic cells. Both strategies would increase specificity and help limit dangerous side effects seen in early CAR-T treatments such as cytokine release syndrome (CRS) (Juno Therapeutics, 2015).
Celgene’s previous deal with bluebird bio failed to meet expectations
In June 2015, Celgene withdrew from a deal with bluebird bio for CAR-T therapies because of a lack of results. The two companies had previously entered into an agreement in March 2013, wherein bluebird stood to earn a maximum of $225m in incentives based on developmental milestones. However, after two years, Celgene only paid out $25m to opt-in for the development and commercialization of an anti B-cell maturation antigen (BCMA) therapy, which was advanced to Phase I trials. Celgene has since returned all rights to bluebird’s pipeline, with the exception of the BCMA drug (Bluebird bio press release, 2015). The new deal with Juno can therefore be interpreted as a shift in faith. It is likely that Celgene viewed Juno’s more advanced CAR-T pipeline as much stronger than bluebird’s. Juno’s pipeline is diverse and its CAR-T cell therapies are being studied in ongoing Phase I trials for chronic lymphocytic leukemia, acute lymphoblastic leukemia (ALL), and diffuse large B-cell lymphoma (DLBCL). JCAR015 was awarded breakthrough therapy designation for DLBCL by the US Food and Drug Administration in November 2014.
High response rates in difficult settings such as ALL and DLBCL are what have made Juno’s CAR-T therapies so attractive. Final results from Juno’s Phase I (MSKCC) trial of JCAR015 in ALL were reported at the 2015 American Society of Clinical Oncology meeting. Complete remissions were reported in 33/38 evaluable patients (87%) and median overall survival (OS) was 8.5 months. The six-month OS rate was 59%. Although these efficacy data are extremely promising, the study did also reveal safety concerns associated with JCAR015. CRS was observed in 9/39 patients (23%), and there were two treatment-related deaths (Park et al., 2015). Furthermore, Phase I data for JCAR015 in DLBCL were presented at the 56th American Society of Hematology annual meeting in December 2014. In this study, patients were given high-dose chemotherapy followed by autologous stem cell transplantation and then JCAR015 infusion. It was reported that 6/6 patients (100%) remained in remission at a median follow-up of nine months. One of these patients experienced severe CRS (Sauter et al., 2014).
The $1bn investment indicates that Celgene believes Juno to be a leading innovator of CAR-T therapies, and that its technologies will be able to compete with or better CAR-T therapies developed by competitors such as Novartis (which has a Phase II pipeline candidate, CTL019), Kite Pharmaceuticals, and Pfizer. CAR-T therapies represent a potential pillar of individualized cancer treatment, but much more clinical development is needed before they can become approved therapies. As highlighted above, early-phase data suggest some CAR-T cell therapies are displaying strong efficacy in certain blood cancers, but adverse events such as severe CRS and other serious toxicity events will have to be addressed in future trials. In addition, because CAR-T is an individualized therapy, there will be high cost burdens placed on insurers and patients. It is also largely unclear whether this therapeutic approach will be viable for treatment of solid tumors.