The ADVOCATE trial, sponsored by ChemoCentryx, assessed the safety of CCX168(avacopan) in inducing and sustaining remission in patients with anti-neutrophil cytoplasmic antibody (ANCA)-associated vasculitis (AAV). To everyone’s surprise a set of conclusive findings from this late-stage clinical trial reveal big commercial potential. Hence drug maker ChemoCentryx’s stock shot up by 250% recently.
The Condition: ANCA Vasculitis
ANCA Vasculitis (antineutrophil cytoplasmic antibody-associated vasculitis) is the name for a class of autoimmune conditions that involve inflammation of the blood vessels caused by the immune system mistakenly attacking them. With no cure at this point, some treatments are available to manage the condition. As such, present day treatments exist to push the condition into remission, where no symptoms appear for a time, and to hopefully remain in remission. Depending on the type and severity, different treatment options are employed.
Currently physicians will prescribe a combination of steroids with Rituxan or cyclophosphamide—which are both immunosuppressants. Unfortunately, steroids can trigger severe side effects.
What is Avacopan?
CCX168 (Avacopan) is a therapy that ChemoCentryx is development for ANCA vasculitis. The company designed the experimental drug to interfere with the damaging inflammatory response in this autoimmune disease. The drug impacts small blood vessels in many organs. As autoimmune diseases, such as ANCA vasculitis triggers inflammation, which damages tissue, Avacopan interferes with the inflammatory response by blocking the protein C5a.
C5a is a member of the complement system—a family of proteins that plays an important role in immune response. In autoimmune diseases, white blood cells actually cause damage to healthy tissue. The blocking of C5aR actually interferes with messages to white blood cells and hence fewer will attract themselves to inflammation sites.
To the great surprise of the sponsor, the Phase III ADVOCATE study evidenced positive results meeting both of its primary endpoints—including 72% of the 331 patients enrolled in the study reported disease remission after 26 weeks on CCX168; 65% sustained remission by the end of the first year. The study results appear to have met a significant set of secondary endpoints such as improved quality of life and kidney function. The sponsor used over 190 clinical investigational sites.
Planned Regulatory Filings
Sponsor ChemoCentryx reports they will submit a New Drug Application (NDA) to the Food and Drug Administration (FDA) and thereafter to the European Medicines Agency (EMA) by in 2020. The company is setting up a commercial salesforce in America, reports MarketWatch, totaling probably up to 75 including medical science liaisons and sales executives.
Investment Banking Analysts
As reported in MarketWatch, investment banking analysts such as SVB Leerink report that “the data suggest that the utility of avacopan in place of steroids does not compromise on efficacy but rather could usher in a new era of (standard of care) where steroids and its associated toxicities may become less a concern.”
JP Morgan predicts the drug could command sales of up to $900 million while SVP Leerink posits they could break to $1.2 billion in the U.S.—in fact Raymond James see a potential total available market of $3 billion worldwide based on an annual gross price of $80,000 which is steep.
Founded in 1997 in the San Francisco Bay, Area they have raised nearly $150 million and went public. With a market capitalization of $1.73 billion, they are projected to produce about $35 million in revenue with costs leading to nearly a $50 million loss. With about $171 cash in this news is what the doctor ordered. Nearly 35% of the company appears to be held by insiders.