Carvykti EMA Approved It For Second-Line Treatment of Patients with Relapsed or Refractory Multiple Myeloma(MM)

Carvykti EMA Approved It For Second-Line Treatment of Patients with Relapsed or Refractory Multiple Myeloma(MM)

On February 23, 2024, the European Medicines Agency (EMA) released the highlights of its meeting held from February 19-22.

As expected, Legend Biotech’s Carvykti received a positive opinion from the EMA’s Committee for Medicinal Products for Human Use (CHMP) for the second-line treatment of relapsed or refractory multiple myeloma (MM) patients.

Carvykti EMA approved for second-line treatment of multiple myeloma

Carvykti EMA approved for second-line treatment of multiple myeloma

Entering the second-line was the initial flag planted by Legend Biotech (with the current ultimate goal being to penetrate the first-line), and the European second-line approval represents an important milestone achieved by Legend Biotech.

At the same time, it has laid a solid foundation for the upcoming FDA meeting on March 15th, where the discussion will focus on whether to approve Carvykti for second-line use in the United States.

After successfully entering the second-line, there are three core issues that investors are most concerned about: the market potential for the second-line, the ability of the supply side to release production capacity in a timely manner, and the probability of penetrating the first-line.

I. Enormous Market Potential

Carvykti’s expansion into the second-line offers immense market potential.

Currently, Carvykti primarily targets three markets: the United States, Europe, and Japan. As a last-line therapy, it serves approximately 20,000 patients annually. However, by entering the second-line, this market will directly expand to approximately 80,000 patients per year, representing a potentially massive market.

The prevailing view is that CAR-T therapy, even when used in the second-line, is for high-risk patients (whose cancers carry certain cell mutations), accounting for 15%-20% of patients, or approximately 12,000-16,000 patients.

Market potential of carvykti

Market potential of carvykti

However, according to Johnson & Johnson’s latest survey, 15%-20% of standard-risk patients are also willing to receive Carvykti because it only requires a one-time injection to complete the treatment. Patients do not need to undergo other treatments or take daily medication, allowing them to lead a normal daily life like others.

As a result, Carvykti’s potential market will encompass at least one-third of second-line patients (approximately 24,000), with a market size exceeding $10 billion.

Furthermore, Johnson & Johnson’s strong sales capabilities in the community channel will ensure that Carvykti can reach its full potential. Currently, 80% of end-line patients receive CAR-T therapy in tertiary medical institutions, while 20% receive it as outpatients.

However, upon advancing to the second-line, this ratio will be reversed, with 80% receiving treatment as outpatients. This is supported by Carvykti’s advantage of a longer median onset period for cytokine release syndrome (CRS), making it the only CAR-T therapy that can be administered in the community (in addition to its efficacy, the administration method is also differentiated).

II. Production Capacity Release

Due to Carvykti’s favorable clinical data and the vast market after advancing to the second-line, the current product’s scaling limitation lies primarily in production capacity. Currently, the first site in Ghent, Belgium, has just begun production (supplying the first-line clinical product cartitude-6), and another site is under construction, expected to come online by the end of this year, which will provide additional capacity for commercial production in Europe.

Additionally, there are two new sites in China, with the first one already GMP-ready. The second, larger facility has just completed construction and is in the process of equipment installation and qualification. In New Jersey, USA, there is a major site providing all commercial products of Carvykti.

As previously disclosed by Johnson & Johnson, another capacity limitation factor was the supply of lentiviral vectors. Recently, Johnson & Johnson’s plant in Switzerland received FDA approval, which includes a large-scale reactor for the supply of lentiviral vectors, making the company self-sufficient in lentiviral vector supply.

Another factory in the United States this year, and a plant in the Netherlands in 2025, will come online with additional lentiviral vector supply, continuing to expand lentiviral vector production according to global demand. The current expansion is progressing towards the goal of completing 10,000 doses of CAR-T by 2026.

Therefore, looking ahead, production capacity issues will no longer be a constraint.

III. Entering the First-Line is Promising

In the United States, 36,000 to 37,000 patients are diagnosed with multiple myeloma annually, with approximately 8,000 to 9,000 undergoing autologous stem cell transplantation (ASCT). The remaining patients undergo high-intensity toxic drug regimens (such as lenalidomide or melphalan), which are often poorly tolerated by patients and can be life-threatening.

Carvykti has scientific and economic reasons to enter the first-line. First, from a scientific perspective, younger and healthier T cells will undoubtedly have a more ideal therapeutic effect, as after undergoing cyclical immunosuppressive drugs (lenalidomide or melphalan), the T cells are essentially depleted. When collecting T cells, the starting material is very weak.

Therefore, Carvykti’s clinical data in the first-line (CARTITUDE-5) and as a first-line alternative to transplantation (CARTITUDE-6) will certainly be better compared to the second-line (CARTITUDE-4).

Second, from an economic perspective, Carvykti costs $466,000, which is not significantly more expensive than autologous ASCT, which starts at $400,000, or allogeneic ASCT, which starts at $900,000.

In fact, if it weren’t for the recent news about the second primary malignancy (SPM) secondary malignancy, which led the FDA to issue a black box warning for CAR-T therapy, the capital market would have been very confident in Carvykti’s entry into the first-line.

Regarding SPM secondary malignancy, out of 97 patients in CARTITUDE-1, 10 patients also had acute myeloid leukemia (AML) and myelodysplastic syndrome (MDS).

A 10% SPM rate sounds alarming, but understanding the patient background provides clarity. First, a paper published at ASH last December showed that these patients had all received treatment with oral IMiDs, injectable proteasome inhibitors, and dexamethasone, which are triple-exposed therapies.

The annualized incidence rate of AML and MDS is approximately 3%. The CARTITUDE-1 trial started in 2018, so after 5-6 years, a cumulative rate of 10% is actually not higher than the background rate for patients receiving this type of treatment. Second, the median onset time for AML and MDS was 485 days, or approximately 1.5 years.

Typically, without Carvykti, the PFS is 4 months, and patients would die within 8 to 9 months. Thus, the fact that these patients were diagnosed with a second malignancy after approximately 1.5 years is actually a positive outcome, as it means they lived for that long.

They were diagnosed with SPM, and out of caution, the FDA required it to be included. Of the 10 cases, 6 occurred during the Carvykti trial, and the other 4 occurred later. Looking at the causes of death, 5 people actually died from other adverse events, such as respiratory failure or septic shock.

Therefore, the SPM issue has not been conclusively defined, and the FDA has not yet provided the overall investigation results, which are still ongoing. It is highly unlikely that this will impact the subsequent entry into the first-line.

Instead, the current challenge lies in the time required to complete the clinical trials.

CARTITUDE-5 will complete enrollment in the United States in 2024H1, while continuing enrollment for CARTITUDE-6. Notably, in CARTITUDE-6, Legend Biotech has chosen a very difficult comparator: quadruplet therapy following ASCT.

Carvykti clinical data

Carvykti clinical data

Last month at ASH, based on trial data, the progression-free survival (PFS) rate at 48 months for quadruplet therapy following ASCT was 84%. Given that CARTITUDE-6 is designed as a superiority trial compared to transplantation, this means that the duration of CARTITUDE-6 will be very long. However, once successful, it will represent a breakthrough in the treatment of MM.

IV. Conclusion

Legend Biotech’s market capitalization has already surpassed $12 billion, with Genscript Biotech Corporation holding a 48% stake in Legend Biotech, which translates to approximately HK$45 billion, significantly lower than its current market capitalization of HK$31.

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