From Overseas, Legend Biotech and Calliditas Therapeutics Eye the Nasdaq

Xconomy New York — 

Legend Biotech, a cancer cell therapy developer with roots in China, is preparing for a US stock exchange listing as its lead candidate keeps pace in the race for a multiple myeloma drug that addresses a new molecular target.

The drug, known as JNJ-4528, is being developed in partnership with Johnson & Johnson (NYSE: JNJ) subsidiary Janssen Biotech. The Legend drug is a cell therapy that targets B-cell maturation antigen (BCMA), a protein found in abundance on the surface of cells in a number of blood cancers, including multiple myeloma. There are currently no FDA-approved therapies that target BCMA.

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Legend plans to use its IPO proceeds to continue clinical development of JNJ-4528, build manufacturing facilities, and, if the drug is approved, prepare for a commercial launch. Legend set a $100 million target for its IPO. If Legend completes the stock offering, it expects to trade on the Nasdaq under the stock symbol “LEGN.”

The Legend drug is a type of cell therapy called a chimeric antigen receptor T cell therapy (CAR T). These therapies are made by withdrawing a patient’s T cells, engineering them to make them better cancer fighters, and then reinfusing them into the patient. Legend makes JNJ-4528 with antibodies isolated from llamas. The resulting cell therapy has two binding domains, which provide two points of contact with tumor antigen. In addition to being better at binding, these smaller and lighter antibodies can reach sites close to the cell membrane that may be inaccessible to larger antibodies, the company says in its IPO filing.

Janssen paid Legend $350 million up front in 2018 to start a development partnership on its BCMA-targeting cancer drug. Legend has since received four milestone payments from its partner totaling $110 million, according to the IPO filing.

Legend and Janssen are currently conducting a Phase 3 trial testing JNJ-4528 in patients whose multiple myeloma has not responded to up to three earlier cancer treatments. The open-label study is enrolling 400 patients who will be randomly assigned to receive the Legend therapy or a combination of three cancer drugs used to treat multiple myeloma. The main goal of the study is progression-free survival—how long a patient lives without their cancer worsening.

One known side effect of CAR T therapy is an immune system reaction called cytokine release syndrome (CRS), an inflammatory response. In a Phase 2 study, Legend reported CRS in 93 percent of patients. Most of the cases were mild. But the company also reported three patient deaths in the Phase 1b portion of the study, one of them attributed to CRS. The second death was attributed to acute myeloid leukemia; the third death was caused by the progress of the disease.

In a Phase 1 study in China, where the Legend cell therapy is referred to as LCAR-B38, the company reported that 82 percent of patients developed CRS, which resolved in all but two. One patient died as a result of CRS and tumor lysis syndrome, according to the filing. A second death was deemed unrelated to the experimental treatment.

A number of companies are developing drugs that take different approaches to BCMA. The frontrunner among cell therapies, a candidate from Bristol Myers Squibb (NYSE: BMY), suffered a setback this week when the FDA refused to review its application and asked the company to provide more information. That development gives Legend and others the opportunity to gain some ground.

Legend began in 2014 as a China-based subsidiary of GenScript, a pharmaceutical industry services provider, according to the IPO filing. GenScript is based in New Jersey but its shares trade on the Hong Kong Exchange. In 2014, Legend incorporated in the Cayman Islands, which levy no tax on income. But the company’s main offices are at a Piscataway, NJ, site adjacent to GenScript.

According to the rules of Hong Kong’s stock exchange, the Legend IPO will be considered a spin-off transaction that requires approval. The exchange granted that approval in March, according to the filing. But even though Legend is separating physically and operationally from GenScript, the parent will still keep close ties to the spinoff. GenScript is Legend’s largest shareholder, owning a 76.9 percent pre-IPO stake, according to the filing. Following the IPO, Legend’s former parent will continue to own a controlling stake in the company, the filing says.

CALLIDITAS THERAPEUTICS PREPS FOR A US IPO

Shares of Calliditas Therapeutics are already traded in Sweden, where the company is based. Now the drug developer is preparing to introduce itself to investors in the US.

Calliditas has filed plans to list American depository shares on the Nasdaq Global Market. The company, which is developing treatments for rare diseases affecting the kidneys and liver, set a preliminary $75 million goal for its US stock market debut. Calliditas’s lead product candidate, Nefecon, is an oral formulation of budesonide, an anti-inflammatory drug used to treat asthma and bowel conditions such as Crohn’s disease and ulcerative colitis. Calliditas is developing its version of the drug as a treatment for IgA nephropathy (IgAN), an autoimmune disease of the kidneys that has no FDA-approved treatment. The disorder leads to deterioration of kidney function, and patients may eventually require dialysis or a kidney transplant.

Nefecon uses proprietary Calliditas drug delivery technology that administers a therapy locally at the liver, minimizing side effects in the rest of the body. In a double-blind, placebo-controlled Phase 2 study that enrolled 150 patients, Calliditas reported that treatment with its drug led to a statistically significant reduction of protein in the urine and stabilization of kidney function. The company is currently testing the drug in a Phase 3 clinical trial.

Preliminary Phase 3 data are expected in the fourth quarter of this year. If the results are positive, Calliditas plans to submit the drug for review in the US and Europe in the first half of next year, the company says in the filing. Calliditas is also exploring development of the drug as a treatment for two other rare disorders, primary biliary cholangitis and autoimmune hepatitis. In the filing, the company says it plans to discuss with the FDA its plans for the drug in both indications in the coming year.

Calliditas was founded in 2004 under the name Pharmalink. The company says in the filing that it acquired Nefecon from two professors at Uppsala University in Sweden who invented the drug. In 2017, the company changed its name to Calliditas. Its shares began trading on the Nasdaq Stockholm Exchange on June 29, 2018.

The IPO filing shows that Calliditas reported cash holdings of 753.5 million Swedish krona (about $76.8 million) at the end of 2019. Calliditas plans to use the IPO proceeds to fund ongoing Phase 3 testing of Nefecon, and to support regulatory submissions in the US and Europe. If Calliditas completes its US IPO, it plans to list its shares under the stock symbol “CALT.”

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