Tesaro rises again on renewed takeover speculation

A successful suitor would claim ovarian cancer prospect niraparib plus an immuno-oncology pipeline.

Tesaro is being name-checked as the next biotech takeover candidate once again, even though it insists it is not actively exploring a sale.

The Massachusetts-based cancer drug developer is taking advice from investment banks, including Citigroup, as it tries to work out how to respond to the approaches from suitors, says a Reuters report. Predictably, neither Tesaro nor Citibank are prepared to comment on that right now.

With big pharma groups snapping up cancer assets on all sides at the moment, Tesaro has long been seen as a hot prospect, and its shares leaped after the report was published.

The biotech's much-touted PARP inhibitor niraparib is just months away from an FDA approval decision as a potential second-line treatment for epithelial ovarian, fallopian tube, or primary peritoneal cancer after platinum-based chemotherapy.

If approved on schedule niraparib would join AstraZeneca's Lynparza (olaparib) and Clovis Oncology's just-launched Rubraca (rupacarib), which are currently the only PARP inhibitors on the market, ahead of rival Pfizer/Medivation whose talazoparib is in late-stage testing.

Tesaro has made much of niraparib's potential label advantage over Lynparza and Rubraca, which are both approved for BRCA-positive tumors only, representing around 10% to 15% of the total patient population. The Massachusetts biotech is pitching at approval for all-comers regardless of BRCA status and—assuming it can get approval with a broad label—niraparib has been forecast by EvaluatePharma to become a $1.8 billion product by 2022.

That lofty sales target could look increasingly attainable if the phase 3 BRAVO trial of niraparib in HER2-negative breast cancer delivers positive results later this year, along with the phase 2 AVANOVA trial comparing niraparib plus Roche's blockbuster Avastin (bevacizumab) to both drugs given alone in ovarian cancer.

Any suitor that snares Tesaro would also get oral drug Varubi (rolapitant) for nausea and vomiting caused by cancer chemotherapy, which is already on the market in the U.S. and with an E.U. verdict due in the coming weeks—plus a pipeline of immuno-oncology candidates with two antibodies targeting PD-1 and LAG-3 heading for the clinic shortly.

It's not all a rosy picture for the biotech. An intravenous formulation of rolapitant has been held up at the FDA because of manufacturing issues, although Tesaro insists it is still hopeful of an approval. Meanwhile, despite being tipped as a future blockbuster sales of Varubi have so far failed to meet expectations, bringing in less than $3 million in the third quarter of 2016.