BMS antes up with Nektar deal worth $3.6B

BMS is betting that NKTR-214 is the magical agent that transforms cold tumors, which don’t respond to their checkpoint inhibitors, into hot ones.

In the frantic rush to find drug combinations that maximize immune checkpoint inhibitor effectiveness, Bristol-Myers Squibb (BMS) just put a lot of chips on the table. On Wednesday, the company cut a deal with Nektar Therapeutics to aggressively co-develop Nektar’s immuno-oncology agent NKTR-214 with BMS’s Opdivo and Yervoy.

NKTR-214 did not come cheap. BMS is paying $1 billion in cash and purchasing around $850 million in Nektar shares. Nektar could also receive $1.78 billion in milestone payments, bringing the potential total to $3.63 billion.

In return, BMS gets to test whether NKTR-214 can help its existing immunotherapies treat more cancer patients. The two companies are going to study these combinations in more than 20 indications across nine tumor types.

“We anticipate this trial program is going to encompass 15,000 patients,” said Stephen Doberstein, Nektar’s chief R&D officer, in a phone interview.

Should any of these combinations receive regulatory approval, Nektar will receive 65 percent of worldwide profits for NKTR-214 and BMS will get exclusivity in 20 indications. Nektar retains the ability to develop NKTR-214 in combination with other, non-immune therapies. The company already has a partnership with Takeda on an early-stage trial.

What is BMS getting for their big investment? Is this the free agent deal that transforms their immuno-oncology franchise and beats back Merck and others? BMS is betting that NKTR-214 is the magical agent that transforms cold tumors, which don’t respond to their checkpoint inhibitors, into hot ones. They may be on the right track.

In November, Nektar released some fairly impressive results at the Society for Immunotherapy of Cancer (SITC) meeting. Early data showed the NKTR-214/Opdivo combination produced high response rates in small numbers of stage 4 melanoma, renal cell carcinoma and non-small cell lung cancer (NSCLC) patients. PD-L1 negative NSCLC patients showed a 75 percent response rate, albeit in four patients.

“We knew even from preclinical models that NKTR-214 was going to increase the number of tumor-infiltrating lymphocytes,” said Doberstein, “and that NKTR-214 was going to increase the expression of PD-1 and PD-L1, which of course is the target of Opdivo.”

The Nektar drug targets the interleukin-2 (IL-2) pathway. On its own, IL-2 has had some success as an immunotherapy but with dreadful side effects. The problem is, it can act on both effector T-cells, which kick up the immune response, and regulatory T-cells, which moderate it. NKTR-214 was designed to selectively boost the effector cells.

“There was so much clinical validation around the target, if we could just optimize its properties, that would bring, for the first time, the ability to control T-cell populations in the body,” said Jonathan Zalevsky, Nektar’s chief scientific officer, in a phone interview. “We could enable new proliferation of healthy, young, fresh, activated T-cells that are antigen-primed and full of effector enzymes that are ready to enter tumor microenvironments and go to work.”

NKTR-214 is also built with a polymer, which disassociates from the drug over time, gradually adjusting its activity.

“It’s not an all-on, all-off kind of mechanism,” said Zalevsky. “It’s a gradual increase, like using a dimmer switch and turning it up slowly.”

On paper, it looks like a great match for BMS. If NKTR-214 can significantly increase the number of patients who respond to Opdivo and Yervoy, the deal could potentially open up huge markets for their immunotherapies. And though it will take a lot more validation, these combos could be great news for many patients.

“NKTR-214 can turn cold tumors into hot tumors and turn low PD-L1 expression into high PD-L1 expression,” said Doberstein. “We might be able to open up the benefits of immunotherapy to the majority of patients who don’t respond at all.”

Photo: Nicol??s Mero??o, Getty Images

CORRECTION: An earlier version misstated the number of patients to be enrolled to test the efficacy of NKTR-214. The correct number is 15,000