Caribou: Potential To Improve Response Duration With Higher Dose Level (NASDAQ:CRBU)

Caribou Biosciences (NASDAQ:CRBU) is a great speculative biotech play to look into. The reason why I state that is because it has done pretty well in establishing initial proof of concept with its CB-010 CAR-T Cell therapy in treating patients with relapsed/refractory B-cell non-Hodgkin lymphoma. Matter of fact, the positive data it observed was with dose level 1 treatment. It is currently conducting the very same study with this patient population using CB-010, but doing so at dose levels 2 & 3. It is not guaranteed, but possible that this higher dose levels might provide greater durability for this type of treatment. Especially, since durability has already been observed at just dose level 1 of CB-010. The first 3 patients were treated at dose level 2 with no dose-limiting toxicities and is in the process of obtaining patients for dose level 3. With the ability to see an improvement of efficacy of CB-010 for this patient population at higher dose levels, I believe this is a great speculative biotech play to look into. In addition, traders/investors won’t have to wait too long to see an update from this program. It is expected that updated results from the phase 1 ANTLER study, using CB-010 for the treatment of patients with r/r B-cell NHL, are going to be released in 2023. This provides an opportunity to see whether or not efficacy can be improved upon just by increasing the dose level. While it remains to be seen if this is achieved, it is already established that just at dose level 1 of CB-010, it is already on par with current autologous CAR-T therapies. That’s impressive, considering data for dose level 2 and dose level 3 have not even been released yet. Just in case CB-010 doesn’t work out, Caribou also has CB-011 which is an allogenic anti-BCMA CAR-T cell therapy being developed for the treatment of patients with relapsed/refractory multiple myeloma (MM).

CB-010 Already Shows Promise At Dose Level One

As I stated above, Caribou Biosciences is developing CB-010 for the treatment of relapsed/refractory B-cell non-Hodgkin Lymphoma (r/r B-cell NHL) patients. Its pipeline is focused on developing allogeneic “off the shelf” CAR-T and CAR-NK cell therapies. However, I believe that it has even greater potential, because of its technology. This is not your standard CAR-T or CAR-NK type of biotech. In order for the biotech to improve durability, it is making use of its CRISPR genome editing technology known as Cas12a chRDNA. You may have heard about gene editing/cutting of Cas12a CRISPR. However, it’s also important to understand what chRDNAs stands for, which is CRISPR hybrid RNA-DNA guides. Why the need for this type of CRISPR? That’s because CRISPR without the proper RNA guide, ends up cutting an unintended genomic site, which is known as off-target editing. To make a more accurate precision cut of a DNA target, this technology was deployed by Caribou. The final outcome is that it can use chRDNA to not only be more accurate, but also to deploy a PD-1 knockout edit along with other edits. The necessity of adding a PD-1 knockout edit is to decrease CB0-010 exhaustion, with the hope of increasing durability. The need to increase durability for CAR-Ts and CAR-NKs is what is needed as an advancement.

As I stated above, there is an ongoing phase 1 study known as ANTLER, which is using CB-010 for the treatment of patients with r/r B-NHL. This study is being explored in multiple parts which are Parts A & B. Part A is the ongoing portion of the study, which has the primary goal of ultimately establishing a recommended phase 2 dose (RP2D). Things are going very well for this part of the study, because thus far only using dose level 1 of 40×10⁶ CAR-T cells has pretty generated some good data. Of course, the therapy started to wear off for many patients after many months. Still, the initial data is encouraging when you consider that there are two other doses being advanced currently, which ware dose level 2 and dose level 3. It was shown that 3 out of 6 patients maintained a durable complete response (CR) at 6 months, and then 2 out of 6 patients made it with durable CR at 12 months and remain on study. It’s important to note that one patient was able to maintain a CR at 18 months to date, which was the first patient recruited into this study.

As I said before, just with dose level 1 of CB-010 is already doing as good as autologous CAR-T therapies. It may not seem like much, but it did convince the FDA to grant CB-010 both Fast Track Designation and Regenerative Medicine Advanced Therapy (RMAT). Dose level 2 is going to be 80×10⁶ CAR-T cells and dose level 3 is going to be 120×10⁶ CAR-T cells. The hope is that by increasing the dose of the CAR-T cell therapy, it will then yield a more durable response. This remains to be seen, but some initial good news to report on the safety side is that 3 patients already given dose level 2 have not yet yielded any dose-limiting toxicities. Hopefully this will stay the same with dose level 3 as well. Having said that, there is a catalyst opportunity for traders/investors to look forward to. It is said that Caribou Biosciences intends to release results from the phase 1 ANTLER study in 2023.

Financials

According to the 10-Q SEC Filing, Caribou Biosciences had cash, cash equivalents, and marketable securities of $342.6 million as of September 30, 2022. A big reason for the cash on hand, is that back in July of 2021 it generated $321 million in net proceeds. Plus, it did also earn since its inception about $88.4 million in net proceeds from the sale of Intellia common stock it received under the Intellia Agreement. Along with $82.3 million generated through September 30, 2022 from other means such as licensing agreements, licensing and collaboration agreements, and service agreements. Plus, its technology sought out interest from the likes of AbbVie (ABBV). That is a deal was made between AbbVie and Caribou to develop two CAR-Ts using the chRDNA technology platform. According to the pipeline, both of these initial targets are in the discovery phase of clinical development. AbbVie has an option to add up to 2 additional CAR-T cell programs as well. Caribou received an upfront payment of about $33 million for this deal and could earn up to an additional $300 million in future development, regulatory and launch milestones. Based on the amount of cash on hand, it believes it has enough funds to operate for at least the next 12 months. While this is not ideal, there is another way to raise cash throughout this year. It filed a shelf registration statement on Form S-3 with the SEC on August 9, 2022. This will allow it to, from time to time, to sell up to $400 million of common stock, preferred stock, debt securities, warrants, rights or units comprised of any combination of. This includes, in part the at-the-market equity offering agreement of $100 million of common stock established with Jefferies LLC.

Risks To Business

There are several risks that traders/investors should be aware of before investing in this biotech. The first risk to consider is with respect to the ongoing phase 1 ANTLER study, which is using CB-010 for the treatment of patients with relapsed/refractory B-cell non-Hodgkin lymphoma (r/r B-cell NHL). That’ because even though initial proof of concept from this phase 1 study established durability of CB-010, there is no guarantee that dose level 2 or dose level 3 of this therapy will improve durability even further. Another risk to consider for this very same program is that even if durability is improved, it has to be done in such a way in which there are no major adverse events noted. As long as Dose level 3 of CB-010 can continue on with no dose-limiting toxicities, then that would put Caribou in a much better position. The final risk to consider would be with respect to the cash position. I say that, because as I noted above in the financials, it believes it only has enough cash to fund it operations for at least the next 12 months. It will likely have to sell shares from the $400 million shelf registration it filed in August of 2022. If it takes this route, then current shareholders of this stock will be diluted if it uses this tool.

Conclusion

The final conclusion is that Caribou Biosciences is a good speculative biotech play to look into. The reason why I state that is because it has already established initial proof of concept from the phase 1 ANTLER study, using CB-010 for the treatment of patients with relapsed/refractory B-cell non-Hodgkin Lymphoma. The longest duration of response as of the most recently reported data was 18 months for a patient with follicular lymphoma (FL) who took dose level 1 of CB-010. Hopefully, dose level 2 and dose level 3 will yield superior durable responses. This remains to be seen, but is a huge possibility. One item to point out, which might reduce risk slightly, is that Caribou has another CAR-T candidate in the pipeline by the name of CB-011. What’s important about this candidate is that while the same technology is being deployed, it is going after another indication. This CAR-T is being developed for the treatment of patients with relapsed/refractory multiple myeloma (r/r MM). The use of CB-011 is being explored in the ongoing open-label phase 1 CaMMouflage trial in adults with r/r MM. With proof of concept established in using CB-010 for the treatment of patients with r/r B-cell NHL, plus the advancement of the chRDNA technology platform, these are the reasons why I believe that Caribou Biosciences is a great speculative biotech play to look into.