Volatile day for CAR-T biotechs after FDA announces cancer safety review

As if biotechs needed any more bad news, CAR-T therapy companies saw shares tumble on the news that the FDA will investigate the “serious risk” of subsequent, secondary cancers that can occur after treatment with the therapies.

Autolus Therapeutics, developer of autologous T-cell therapies, dropped down to $3.05 per share after opening at $4.78, before recovering to $4.55 at close. Natural killer cell biotech Nkarta was volatile throughout the day, but only lost about 1% of its value, closing at $2.46 compared to $2.54 at open. Arcellx started at $52.95, fell to $48.37 and leveled out to finish the day at $51.10.

Meanwhile, companies with already approved therapies cratered. Legend Biotech, which developed Carvykti with Johnson & Johnson, fell to a low of $57.38 after the FDA news dropped, before recovering to $59.99 at close. This compares to $61.69 at open.

Big Pharmas with approved CAR-Ts saw a blip on their radar. Bristol Myers Squibb fell from $49.31 to $48.99 on the review news, before recovering most of that and closing at $48.92. Gilead’s shares topped out around $74.92 this morning before falling slightly to $74.25, ultimately finishing the day at $74.51.

The agency said today that it has received reports of T-cell malignancies—including CAR-positive lymphoma—among patients who received BCMA- or CD19-directed CAR-T immunotherapies. Some of those patients were hospitalized or later died. The events are from clinical trials as well as post-marketing surveillance programs.

Approved BCMA-directed and CD19-directed genetically modified autologous T-cell immunotherapies that use integrating vectors, such as lentiviral or retroviral vectors, already have this potential risk listed as a class-wide warning on their labels. Companies have been required to monitor patients for 15 years following treatment.

But the FDA may now take even more direct regulatory action. In announcing the review, the agency stated that the overall benefit of the approved product still outweighs the risks. 

The FDA’s investigation applies to all approved CAR-Ts, which currently totals six. Dozens of companies have follow-ups in the clinic that hope to improve on certain aspects of the CAR-T process.

Analysts from William Blair noted the stock market reaction in a Tuesday afternoon note, saying that companies with CAR-T therapies in autoimmune indications have been particularly vulnerable. The firm said that these therapies have shown promise in early data but the risk of cancer might not be acceptable to the overall benefit/risk ratio, as it might be in oncology.

Nkarta, for instance, just announced a move to take its cell therapy work beyond cancer with a green light for a clinical trial of a CAR-NK candidate in lupus.

William Blair said it still sees significant benefit for autoimmune patients if the data continues to show durability and provide treatment-free intervals of multiple years.

For oncology CAR-T companies, William Blair called the stock market reaction “overdone.” These companies will have an opportunity at the upcoming American Society of Hematology meeting in December to prove their case, as well as with data readouts expected in 2024.

“We also believe the news has no read-through to companies that use nonviral approaches for CAR insertion, such as Poseida, and minimal impact on companies developing allogeneic approaches,” William Blair wrote. Allogeneic companies include Allogene, CRISPR Therapeutics, Nkarta, Century Therapeutics and Poseida Therapeutics. The firm said that “the host immune system more readily and rapidly rejects these compared to autologous approaches.”

Allogeneic cell therapies use stem cells from a donor that matches the patients to treat cancers such as leukemia, lymphoma and multiple myeloma. Autologous cell therapy uses a patient’s own cells that are removed, tweaked with the medicine and then reinfused back into the body.