RCC represents a multi-billion dollar market for Cometriq. Here's the calculation for a billion dollars in sales:
$1B = 5,700 patients x $11,000/28 day cycle x 13 cycles/yr x 14.7/12 yrs
Metastatic cancer is a terminal illness, so the patient population is measured by the cancer death rate. In RCC, it is 11,100 in the U.S. The EU is about the same amount."From Q3 2014 financial report:
Patients were randomized 1:1 to the Cometriq and Afinitor groups. Due to the much shorter 4.9 months median PFS for the Afinitor group, all 187 events for this group will have occurred by Q2 2015 (3 standard deviations is 99%). This leaves only 72 Cometriq events at the 259 event readout. A majority of 115 Cometriq patients will still be progression free at the 259 event readout of results so a Kaplan-Meier estimate of Cometriq median PFS will be made."
METEOR Success Changes Everything
METEOR: A phase 3, randomized, controlled study of Cometriq vs Afinitor in subjects with metastatic renal cell carcinoma (RCC) that have progressed after prior VEGFR tyrosine kinase inhibitor therapy. The primary endpoint is median progression free survival (NYSE:PFS), with the trial assumptions for success as 7.5 months for Cometriq vs 4.9 months for Afinitor.
Timeframe for trial results: Q2 2015
The 4.9 months median PFS for Afinitor comes directly from the phase 3 trial results that led to its approval in RCC in 2009. Afinitor is the standard of care 2nd line treatment for RCC.
The Cometriq results of an early stage trial with 25 RCC patients was presented at ASCO 2012 in an oral presentation with great interest:
•25 heavily pretreated (2 - 4+ pretreatments) RCC patients with metastases
•½ were treated with a mTOR inhibitor (Afinitor is an mTOR inhibitor)
•90% had an objective tumor regression
•28% had a RECIST confirmed response (30% or more tumor shrinkage)
•Kaplan Meier estimate of median PFS is 14.7 months
As you see, Cometriq's median PFS is 14.7 months, three times Afinitor's 4.9 months and almost twice the 7.5 months necessary for METEOR success.
How do heavily pretreated patients actually represent a worst case sampling? The reason why a cancer treatment stops working is because the cancer (a diseased tissue stem cell) adaptively mutates to overcome the environmental hazard of that cancer treatment. With each new line of treatment, the cancer becomes more resistant and the patient's health continues to decline.
What is the significance of half the patients receiving prior Afinitor-like mTOR inhibitor treatment? Since off-label use of drugs is permitted in the United States. Once Cometriq is approved for 2nd line RCC, it can also be used in 3rd line treatment after Afinitor. If it proves to be as effective as the early stage trial for patients pretreated with a mTOR inhibitor, physicians will definitely use it that way.
1.If the METEOR trial results are as impressive as expected, Fast-Track filing of the NDA is likely, meaning a shorter 6 month review.
2.If the NDA filing could be completed 2 month after the METEOR read out of results, this could lead to FDA approval by Feb 2016.
3.Cobimetinib revenue in the 2nd half of 2015, and the start of MTC revenue from the EU, could fund 2016 operations until the FDA approval of Cometriq in RCC.
4.After FDA approval, there shouldn't be any problems negotiating any financial terms to fund operations until the company reaches breakeven.
5.This may require just 1,000 RCC patients and take only 6 months to add $175M in annual RCC revenue.
6.Early filing with the EMA (European Medicines Agency) might also lead to a 2016 approval of Cometriq in RCC.Overall, I would say the financial risk has shifted from high to low. After the proven success of the METEOR trial, Cometriq will become the new standard of care for 2nd line RCC, for a potential billion dollar new revenue stream.The recognition of RCC revenue is the key point in making the bullish argument vs the bearish argument ofinsufficient revenue. The market has not seen the bull case until now.Cometriq Safety
Cometriq is already an approved drug for MTC in both the U.S and the EU, so drug safety issues have already been addressed. However, Exelixis has gone further with the safety issue than anyone else, by testing Cometriq for minimum effective dose.
In MTC Cometriq has a 175 mg starting dose, close to the maximum tolerated dose, typical of most cancer drug testing. After determining the minimum effective dose to be 40 mg, the new standard starting dose for Cometriq is 60 mg in all clinical trials. At 60 mg it's like a new drug. Frequency of occurrence and intensity of side effects are significantly reduced.
Feb. 17, 2015 by Thomas Chin"Summary
•2nd line RCC in the U.S. is a billion dollar market.
•Cometriq yields results three times better than Afinitor (14.7 months vs 4.9 months).
•Exelixis has 100% ownership of Cometriq.
•Capturing a modest 25% of the U.S. RCC market as the new standard of care in 2nd line RCC would bring in $500M in new revenue. •Proof of early METEOR success is shown. Risk Assessment
Long term debt matures in the 2018-2019 timeframe. It cost $7.5M in non-cash interest in Q3 (the interest compounds until maturity). In 2019, 77% of the long term debt matures in the form of 4.25% convertible notes. The Deerfield notes will be renewed in July 2015 for another 3 years.
Exelixis Q3 2014 financial report has made it clear that the current cash of $293.5 M is good thru 2015 with the announced restructuring, while still maintaining $81 M cash for operational liquidity. This safe financial runway extends past 2015 with any new revenues.
Within the secure 2015 timeframe, a comprehensive financial solution does exist with the success of the METEOR trial in RCC with a potential billion dollar revenue stream. Cometriq's superior benefit will make it the new standard of care for 2nd line RCC. This would erase all current financial concerns. See the section titled "METEOR Success Changes Everything" for a full description of the RCC trial. There I provide evidence for early METEOR trial success. METEOR success is real, the only remaining concern is that it will run into 2016 for FDA approval and require some more time before sales ramp up to break even.
Here's a scenario for how events may play out to secure the RCC revenue stream:
4 letter word there for support theories. Freakonomics and other nonsense sucks if you ask me. Show me scientific proof. And lets get the share price to fly.
He siad nothing about a 140mg dose."If you believe that 60mg will be more toxic than 140mg, then I have a beach front property in the Mojave desert that I would like to sell you."
Thanks for that info.. I hope you are right and he wants the price down. And I hope he has rto eat crow!
I hope you are right. But I have lost lots of confidence in Cabo. I was hoping roche would make Cobi a winner. But today someone posted it has lots of competion. Depressing 2 days.
Nothing like misquoting. He said 60mg not 160mg as you stated. " data in this indication and others to be presented at ASCO, will support our contention that 60 mg is too intolerable for patients, which could bode poorly for the ongoing Phase 3 METEOR trial which employs this dose in relatively healthy RCC patients."Toxic side affects have long been a problem for Cabo; unfortunately.
I have had a lot of shares for well over 10 yrs; in the Exel 401K plan. I sure want the price to return to what it was yrs. ago well over $12. I was feeling good when the price was going up a little and vol. was high, the last few days. But now toxicity is appearing again. This is not the first time this has come up. This was part of it's down fall before. Again I'm not happy about that today.
Stifel reported it is too toxic. It's on the TD Amertrade page.