Pfizer's abrupt abandonment of a development deal with Celldex for the mid-stage brain cancer vaccine CDX-110 - despite positive Phase II data backing the drug - is a blow for development of drugs to treat the rare glioblastoma multiforme.

On Sept. 3, Celldex announced that effective November 1, an agreement for global rights to the seemingly promising vaccine, also called rindopepimut, will be terminated.

Positive Phase IIb results for the vaccine, which targets epidermal growth factor receptor III, had just been released at the American Society of Clinical Oncology meeting in June. Data suggest a doubling in progression free survival for patients who express EGFRvIII. And the recent, ground-breaking FDA approval of Dendreon's prostate cancer Provenge has generated greater interest in cancer vaccines across the board.

The deal for CDX-110 dates back to April 2008, when Pfizer agreed to pay Avant Therapeutics, which reverse merged with Celldex, $40 million upfront and another $390 million in milestone payments for the candidate (Also see "Pfizer Taps Avant’s Phase II Brain Cancer Drug" - Pink Sheet, 16 April, 2008.). At the time, the deal was a watershed moment for the industry, signaling Big Pharma's interest in the disease, despite the rareness of the condition, with only about 10,000 cases in the U.S. (Also see "Glioblastoma Start-Ups Get Specific" - Scrip, 1 July, 2008.).

During a Sept. 3 investors' call, Celldex executives said that they were limited in what they could say during the 60-day transition period with Pfizer for transfer of ownership. However they could confirm plans to advance the program into a Phase III clinical trial in front-line glioblastoma multiforme, which if positive, could be used to file a BLA for approval.

Since the deal was struck with Pfizer, Celldex noted it has increased its staff to 100 from 25 and it may still need to hire additional personnel for Phase III.

"We don't need a partner going forward. We plan on pushing it into Phase III ourselves," said CEO Anthony Marucci.

However, given that the company had just $65 million in cash and cash equivalents at the end of the second quarter, it will need to raise more money to achieve its goal.

Pfizer: Dropping Vaccine Was A "Business Decision"

As is typical when a big pharma partner unwinds an alliance with a biotech partner, doubts about rindopepimut's potential efficacy quickly surfaced in the investor community. Shares of the biotech traded down more than 25 percent on the news to a closing price of $3.53. The decision, however, does not appear to have been related to safety or efficacy signals, at least not based on publicly available information.

Pfizer was tight-lipped about the decision. The company told "The Pink Sheet" DAILY merely that the move was a "business decision" resulting from a review of priorities. However, the company would not confirm that the decision was in no way related to safety or efficacy.

"Pfizer oncology routinely prioritizes assets across our portfolio to focus our efforts on successfully and efficiently developing new therapies for patients with cancer," the spokesperson said in a statement e-mailed to "The Pink Sheet" DAILY.

WBB Securities analyst Stephen Brozak commented in an interview that at least based on the publicly available information, the decision appears to be based not on the drug's safety or efficacy, but on the risk reward picture in the tough-to-treat glioblastoma. If so, it's a blow for the thousands of patients suffering for the disease, and another sign that Big Pharma's priorities are askew, in the analyst's view.

Given Pfizer's priorities for oncology development, abandonment of a cancer vaccine is somewhat surprising. According to the company website, the Pfizer Oncology Business Unit's approach to the fight against cancer focuses on four different methods of treatment: angiogenesis inhibition, immunotherapy, signal transduction inhibition and cell cycle regulation. Pfizer devotes 20 percent of its budget to oncology and has spent more than a decade building its oncology pipeline, but with mixed results ('The Pink Sheet' DAILY, Feb. 1, 2010)

The Celldex candidate was the only cancer vaccine in its pipeline, but the company "remains committed to immuno-oncology," a spokesperson told "The Pink Sheet" DAILY.

Brain Cancer Market Still Attractive, Says Celldex

In a press statement announcing the termination of the Pfizer deal, Celldex noted that the CDX-110 program has progressed significantly and that the candidate is "well-positioned to advance into clinical studies," and that the "GBM market remains extremely attractive."

Following Dendreon's launch of Provenge, the outlook is good for immunotherapy, said Chief Medical Officer Thomas Davis.

"While five or ten years ago there was skepticism, I think today there is clear validation of the vaccine approach to cancer therapy and now with Provenge on the market I think people readily accept the fact that vaccines can impact the course of disease," he said.

During the investors' call, Celldex said it will be able to offer more clarity about its plans after November 1. Around that time there should also be additional clarity about the efficacy and safety of CDX-110, since Celldex will present additional studies of the molecule at the 2010 Neuro-oncology Scientific Annual meeting.

"Once we complete the program transition we will update our guidance on future cash burn. It would be appropriate, however, for us to consider a financing to bring this program to fruition as well as the rest of our pipeline going forward," said Marucci.

Writing in a Sept. 3 note, Needham & Co.'s Mark Monane advised taking advantage of the lower price to buy Celldex stock. The company now has enough cash to advance its clinical programs and fund operations into 2012, including payment of debt, he noted. The need for additional cash for the Phase III program and the loss of a Big Pharma partner may present an overhang on the stock, Monane wrote.

"Yet we believe that the company has the personnel and experience to conduct the trial without a Big Pharma partnership," Monane added.

The company's pipeline also includes the antibody drug conjugate CDX-011, which targets glycoprotein NMB, an asset picked up through its May 2009 acquisition of CuraGen. Celldex is also developing CDX-1307 and CDX-1401.

"Faster progression of the Phase 3 program and successful pipeline advancement of the Phase 2b CDX-011 program in breast cancer and Phase I CDX-1401 program in solid tumors may provide further upside to the stock," Monane wrote.

- Emily Hayes (e.hayes@elsevier.com)

Pfizer Axes Deal For Brain Cancer Vaccine, Leaves Partner Celldex In the Lurch

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