Legend Biotech: CARTITUDE-4 Study A Success (NASDAQ:LEGN)

Legend Biotech (NASDAQ:LEGN) announced last week that Carvykti (ciltacabtagene autoleucel; Cilta-Cel) achieved the primary endpoint in the phase 3 CARTITUDE-4 trial after the first interim analysis in multiple myeloma patients who have received one to three prior lines of therapy. This is a great achievement but also not a surprising outcome considering the robust results it achieved in prior trials. A positive market reaction was lacking last week, but the expectations of a positive outcome probably played a big part there and so did the lack of any actual data disclosure in the press release. This means we have to wait for the presentation of the data at a medical conference in a few months.

When the data are presented, the key will be to see good median progression-free survival (‘PFS’), how the safety and tolerability look like due to some of the concerns from prior trials, and how Carvykti’s data stack up against Bristol-Myers Squibb’s (BMY) Abecma in the KarMMA-3 trial, although the results will not be entirely comparable since Abecma was tested in patients who received two to four prior lines of therapy versus one to three for Carvykti, and prior use of Darzalex was required in Abecma’s trial and it was not in the CARTITUDE-4 trial. We are also yet to see the results from Abecma’s KarMMA-3 trial, but we do know it too was successful.

On the efficacy side, if CARTITUDE-1 is a guide, where the 27-month PFS rate was 54.9%, we should see very robust results since patients in CARTITUDE-4 are in the earlier line and in better shape. The follow-up in the CARTITUDE-4 trial will be too short to reach median PFS after the first interim analysis, so, it will be important to see PFS rates at appropriate time points.

In addition to CARTITUDE-1 data, the impressive data from the CARTITUDE-2 trials also give reasons to be optimistic – overall response rates of 95% and 100% in cohorts A and B, respectively, and a 15-month PFS of 70% in cohort A and 12-month PFS of 89.5% in cohort B. I believe that when the data are mature enough, it is reasonably likely to expect the median PFS to be more than three years in the CARTITUDE-4 trial.

Of course, it will be important to see how Carvykti did against the comparator arm in the trial, but as I mentioned in my previous article, the bar is not that high considering Carvykti’s efficacy in prior trials and the fact the control arm’s median PFS was between 11 months and 17 months in previous trials.

My expectation of the median PFS being north of 36 months and the prior data of the control arm suggest the hazard ratio should be at least below 0.50 (indicating a 50% reduction in the risk of disease progression in patients receiving Carvykti), and possibly/likely below 0.40.

And on the safety side, it will be important not to see any negative surprises, but the risk here has decreased as there is now data on several hundred multiple myeloma patients. Cytokine release syndrome, neurotoxicity, and prolonged cytopenias are the key side effects to keep an eye on and they should not be worse than in the CARTITUDE-1 trial.

Launch of Carvykti still impacted by supply issues and J&J’s careful ramp

Net sales of Carvykti in the fourth quarter were flat sequentially at $55 million. Partner Johnson & Johnson (JNJ) noted on the Q4 2022 earnings call that demand for Carvykti has been very strong and that they are working to build production capacity and expand the network of treatment centers. Growth should pick up in the following quarters, but more so toward the end of 2023 when the impact of manufacturing expansion is likely to be felt.

The demand outstripping supply is also a reason J&J and Legend need not hurry to get label the label expanded to include earlier lines of therapy. There is more than enough time to gather data and submit the supplemental applications.

Legend also made progress in China. In early January, the company announced that China’s NMPA has formally accepted its new drug application for Carvykti. The submission is not based on the CARTITUDE-1 data but on phase 2 trial called CARTIFAN-1 conducted in China and which evaluated the efficacy and safety of Carvykti in adult patients with multiple myeloma who have received three or more prior lines of therapy. This means that the label in China should be broader out of the gate as the U.S. label is limited to fifth-line-plus multiple myeloma patients. And I should note that, while the price of Carvykti will likely be lower in China, Legend will have better economics as it gets 70% of the profits versus a 50-50 split with J&J in other territories.

Conclusion

CARTITUDE-4 was (unsurprisingly) successful after the first interim analysis and it puts Legend and partner J&J on a clear path to an expanded label that will triple the number of eligible multiple myeloma patients. The most important catalyst in the near term is still the CARTITUDE-4 trial as we have to wait for a medical conference to see the actual data. Partner J&J should, in the meantime, work on resolving the manufacturing issues that are a constraint on Carvykti’s uptake in the United States. I continue to see Legend as very well positioned for long-term growth with Carvykti likely exceeding J&J’s global peak sales guidance of $5 billion.