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I-Mab (NASDAQ:IMAB) is a great speculative biotech play to look into. The reason why I state that is because it has a drug known as Lemzoparlimab. The goal is to initiate a phase 3 study using this drug in combination with azacitidine for the treatment of 1st-line myelodysplastic syndrome (MDS). The biotech had a great end of phase 2 meeting with Chinese authorities and received the go ahead to initiate a phase 3 study for this program. This late-stage study is expected to be initiated in Q4 of 2022.
In addition, the company is also exploring a few other indications with the use of Lemzoparlimab. It has developed a partnership with AbbVie (ABBV) to develop new CD47 antibodies. If such a partnership makes it all the way through all the milestones, then I-Mab would be entitled to receive up to $1.295 billion in milestone payments.
The biotech is also in the process of initiating another phase 3 registrational trial as well. This involves the use of its differentiated CD73 antibody uliledlimab being developed to treat patients with non-small cell lung cancer (NSCLC). It also has plans to initiate a phase 3 study in the United States targeting other cancer types, however, it hopes to do so through other drugs besides PD-1 inhibitors within the next 12 months. It will also make available results from the ongoing phase 2 study of uliledlimab for the treatment of patients with NSCLC by the end of 2022.
The main thing you probably want to know is, what is its intended goal? It believes it could have 5 clinical-stage assets with at least three Biologic Licensing Applications (BLAs) within the next 3 years. Then, it has a bispecific antibody known as TJ-CD4B, which is being developed to treat patients with various types of solid tumors. This drug is currently being explored in a phase 1 study. One key thing to note is that I-Mab is exploring partnership opportunities for uliledlimab and TJ-CD4B, which could also create shareholder value as well.
CD47 Inhibitor With Proof Of Concept Already Established
The first program to go over involves the use of Lemzoparlimab for the treatment of patients with Myelodysplastic Syndrome. Myelodysplastic Syndrome (MDS) involves a group of cancers that keep your blood stem cells from maturing into healthy blood cells. However, MDS can also cause other problems as well, ranging from developing Acute Myeloid Leukemia (AML) or anemia (lack of healthy red blood cells to carry oxygen), frequent infections, and bleeding episodes which may not stop. Healthy red blood cells are made in the soft spongy area known as the bone marrow. If such production doesn’t work, then red blood cells die in the bone marrow, or if they reach out to parts of your body they die off. When red blood cells die in the bone marrow, there is no room for the healthy red blood cells to exist. This effect leads to serious problems, which is why MDS needs to be taken care of. The global Myelodysplastic Syndrome market is expected to reach $3.26 billion in 2022 and grow at about 9.3% CAGR thereafter until 2030.
There are several symptoms that these patients experience as well, which are as follows:
- You are tired/weak
- Skin becomes pale
- Bleed more often
- Frequent infections
- Frequent fevers.
The goal for I-Mab is to advance Lemzoparlimab to a phase 3 study in treating newly diagnosed higher-risk MDS patients in Q4 of 2022. Of course, it already received authorization from the CDE and NMPA (Chinese authority agencies) to begin such a study. It expects to initiate this phase 3 registrational study before the end of this year, likely Q4 of 2022.
The main reason why I’m talking about this program is because it is the furthest along. If a phase 3 study starts by the end of this year for Lemzoparlimab for newly diagnosed MDS patients, then results should be out within a few years. If the trial meets the primary endpoint at completion, then I-Mab holds the potential to have the first CD47 approved in China. That’s because, according to talks with Chinese Authorities, this is a registrational trial, which is capable of having a BLA filed should the primary endpoint be met.
Thus far, it is a pretty good product in terms of treating patients with hematological malignancies (blood cancers). That is evident by the clinical data achieved to date. About 90 patients with newly diagnosed MDS or acute myeloid leukemia (AML) have received 30 mg/kg Lemzoparlimab in combination with azacitidine (chemotherapy). It was revealed that even without any type of priming dose given to about 50 MDS patients, combination treatment of Lemzoparlimab was very safe/tolerable. It was shown that in terms of MDS patients, there was a >80% objective response rate (ORR). With magrolimab and Azacitidine, the combination is comparable to being slightly below this 80% ORR number.
Gilead Sciences (GILD) owns magrolimab (CD47 inhibitor) now after buying Forty Seven Inc awhile back. However, I-Mab released updated results at the European Society for Medical Oncology (ESMO) Congress 2022 on September 10, 2022 with an oral presentation. For MDS patients receiving a dose of Lemzoparlimab at 3 months, the ORR was 80.6%, and then over 6 months of dosing the ORR rose to 86.7%. The complete response rate in the most recent update was said to be 40%. With this data on hand, it can now push forward to going after high risk MDS patients in the phase 3 study it just received authorization for.
Financials
According to the 6-K SEC Filing, I-Mab has a cash position of $586 million on hand. It believes that with the current cash on hand, that it could fund its operations for more than 3 years. One thing to keep in mind for this speculative biotech name is that, while its financials are in good order, there is an overhang of an HFCAA delisting. This is not guaranteed, but a possibility because of legislation act holding foreign companies accountable. I believe this is huge risk – as such, I thought it was important to mention this. It should be good on cash for the time being, therefore, I don’t see it needing to raise cash in the near-term. I believe what could be possible is if it chooses to raise cash after receiving regulatory approvals in China for one of the BLAs expected in the coming years.
Risks To Business
There are several risk factors to consider before investing in this biotech. The biggest risk factor would be the overhang of the HFCAA delisting noted above. However, I-Mab states that it has the situation under control by providing shareholders a road map and value to what it intends to do so that it won’t be delisted. It believes it can mitigate delisting risks under the HFCAA based on specific steps it has taken in the last 6 months. Despite taking this action, there is still no assurance that it won’t face this risk of delisting. It hopes that its current plan of the Statement of Protocol, or a possible contingency plan of changing its auditor should it need to, will accomplish this.
The second risk would be with respect to the initiation of the phase 3 registration study, which is using Lemzoparlimab for the treatment of high risk MDS patients. It will take a few years to run this study, and if the primary endpoint is not met, then I-Mab will not be able to file a BLA for approval of this drug in China.
The company does have two other products in its pipeline ready to potentially receive BLAs in China. These are for felzartamab for the treatment of patients with multiple myeloma (MM), and then eftansomatropin alfa for growth hormone deficiency. There is no guarantee that one or both of these drugs will be approved for their respective indications.
The final risk would be relating to readouts of the ongoing phase 2 studies using uliledlimab for the treatment of patients with non-small cell lung cancer (NSCLC), which are expected around Q4 of 2022. There is no guarantee that the results to be released for this program will turn out to be positive. If the mid-stage studies do succeed, then that would give the greenlight for I-Mab to initiate a late-stage registrational study for uliledlimab.
Conclusion
The final conclusion is that I-Mab is a great speculative biotech play to look into. The reason why I state that is because it expects to have three BLAs file in China over the next few years. I already noted that it is gearing towards BLA submissions of felzartamab for MM and eftansomatropin alfa for growth hormone deficiency in China. The third drug, Lemzoparlimab, will soon be explored in a phase 3 study in treating patients with high risk MDS. Again, this late-stage registrational study is expected to start soon in Q4 of 2022.
Not only is there potential to receive regulatory approval for these three clinical candidates, but this biotech has a huge pipeline full of other drugs to advance. For instance, investors have a catalyst to look forward to before the end of 2022, besides the initiation of the pivotal phase 3 registration study using Lemzoparlimab for the treatment of patients with high risk MDS. The other catalyst expected would be from the phase 2 studies dealing with the use of uliledlimab for the treatment of patients with non-small cell lung cancer. Results from this study are expected in Q4 of 2022. It has six other drugs in the pipeline. Three of them are in phase 2 studies and the other three are in phase 1 studies.
With three expected BLAs in China over the next few years, plus many other catalysts to look forward to, these are the reasons why I believe that I-Mab is a great speculative biotech play to look into.
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