Selecta released Q2 2018 results and announced updates regarding their Phase 2 SEL-212 5+0 dosing and Phase 3 plans. Here are main takeaways:
5+0 dosing to be presented in October
Data from patients receiving five monthly doses of SEL-212 (“5+0 dosing”) expected to be presented at the American College of Rheumatology (ACR) Annual Meeting in Chicago on October 19-24, 2018. In a prior note, we had wrongly predicted that this 5+0 dosing data would come in early September.
The company mentioned that the 5+0 data in late October will include results from 30-40 patients and determine Phase 3 dosing. We believe this 5+0 data will distinguish Selecta as having higher response rates (expecting ~70% response rate) to commercial competitor Krystexxa (read more here).
SEL-212 Phase 3 to begin Q4 2018
This pivotal Phase 3 will test 5 monthly doses of 0.1mg/kg to 0.15 mg/kg of svp-rapamycin in combination with 0.2mg/kg pegsiticase. Topline data is expected in 2020.
Head-to-head trial against Krystexxa will be conducted in parallel with the Phase 3 program
This study is planning to enroll approximately 100 patients (50 on Krystexxa and 50 on SEL-212) and will measure serum uric acid levels (SUA) and flare rates. Although this planned study implies that Selecta is confident in head to head results against Krystexxa, we are not sure how much value it will provide when marketing SEL-212 to doctors and patients.
We say this because we are still unsure of the design of this head to head study. Will it be an apples to apples comparison? SEL-212 is a co-administration of pegsiticase with svp-rapamycin (an immunosuppressant) whereas Krystexxa alone may not be using an immunosuppressant.
Additionally, Horizon is conducting its own Phase 2 that will test Krystexxa co-administration with mycophenolate mofetil (an immunosuppressant). The results from this Horizon study can essentially be used as head to head data against SEL-212.
Update on financial standing
Selecta had $66.2 million in cash as of June 30, 2018. This is expected to be sufficient to fund the company through the end of Q3 2019. The current operating plan accounts for partial funding of SEL-212 Phase 3 trial, but will require additional financing to expand enrollment in the Phase 3 trial and to conduct the planned head-to-head trial against Krystexxa. We believe the company will raise money after the 5+0 data in October.
Selecta’s tight cash position also makes us question why Selecta would choose to allocate development costs to a head to head trial that may show marginal benefit.
Bottom line: Overall, we are bullish on Selecta’s upcoming October data and think it will distinguish SEL-212 as a superior alternative to Krystexxa. We think SELB warrants a high-teen price with response rates in the 70% range. We plan to hold through Phase 2 data in October and will revisit the position shortly after, mainly due to the company’s financial position and post-October strategy.
5+0 dosing to be presented in October
Data from patients receiving five monthly doses of SEL-212 (“5+0 dosing”) expected to be presented at the American College of Rheumatology (ACR) Annual Meeting in Chicago on October 19-24, 2018. In a prior note, we had wrongly predicted that this 5+0 dosing data would come in early September.
The company mentioned that the 5+0 data in late October will include results from 30-40 patients and determine Phase 3 dosing. We believe this 5+0 data will distinguish Selecta as having higher response rates (expecting ~70% response rate) to commercial competitor Krystexxa (read more here).
SEL-212 Phase 3 to begin Q4 2018
This pivotal Phase 3 will test 5 monthly doses of 0.1mg/kg to 0.15 mg/kg of svp-rapamycin in combination with 0.2mg/kg pegsiticase. Topline data is expected in 2020.
Head-to-head trial against Krystexxa will be conducted in parallel with the Phase 3 program
This study is planning to enroll approximately 100 patients (50 on Krystexxa and 50 on SEL-212) and will measure serum uric acid levels (SUA) and flare rates. Although this planned study implies that Selecta is confident in head to head results against Krystexxa, we are not sure how much value it will provide when marketing SEL-212 to doctors and patients.
We say this because we are still unsure of the design of this head to head study. Will it be an apples to apples comparison? SEL-212 is a co-administration of pegsiticase with svp-rapamycin (an immunosuppressant) whereas Krystexxa alone may not be using an immunosuppressant.
Additionally, Horizon is conducting its own Phase 2 that will test Krystexxa co-administration with mycophenolate mofetil (an immunosuppressant). The results from this Horizon study can essentially be used as head to head data against SEL-212.
Update on financial standing
Selecta had $66.2 million in cash as of June 30, 2018. This is expected to be sufficient to fund the company through the end of Q3 2019. The current operating plan accounts for partial funding of SEL-212 Phase 3 trial, but will require additional financing to expand enrollment in the Phase 3 trial and to conduct the planned head-to-head trial against Krystexxa. We believe the company will raise money after the 5+0 data in October.
Selecta’s tight cash position also makes us question why Selecta would choose to allocate development costs to a head to head trial that may show marginal benefit.
Bottom line: Overall, we are bullish on Selecta’s upcoming October data and think it will distinguish SEL-212 as a superior alternative to Krystexxa. We think SELB warrants a high-teen price with response rates in the 70% range. We plan to hold through Phase 2 data in October and will revisit the position shortly after, mainly due to the company’s financial position and post-October strategy.
PropThink contributors are LONG SELB.
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