Biomarkers point the way ahead

Update | 27 June 2018

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BerGenBio presented interim data from all six of its Phase II bemcentinib trials in oncology during the ASCO meeting. The data were preliminary, but they are supportive of bemcentinib’s broad potential in oncology. There were also promising biomarker data suggesting that expression of Axl in tumours and soluble Axl in blood could be used to identify patients likely to benefit from bemcentinib treatment. Of particular interest were data from the non-small cell lung cancer (NSCLC) combination trial with bemcentinib and pembrolizumab (Keytruda), which suggest that the two drugs could be used to treat patients with tumours that do not express PD-L1. Since ASCO, this trial has met the efficacy endpoint for stage 1 and 24 more patients will be recruited. Our valuation of BerGenBio is maintained at NOK52.65/share.

Year-end: December 31201620172018E2019E
Sales (NOKm)
Adj. PBT (NOKm)(129.8)(182.2)(237.0)(241.7)
Net Income (NOKm)(129.8)(182.2)(237.0)(241.7)
Adj. EPS (NOK)(419.7)(4.0)(4.7)(4.8)
Cash (NOKm)161.8370.4312.180.2
EBITDA (NOKm)(131.4)(183.5)(236.4)(232.9)
Source: Trinity Delta Note: Adjusted numbers exclude exceptionals.
  • Preliminary interim data shows promise The data presented during ASCO suggest that bemcentinib has the potential to be used as monotherapy, and in combination with immuno-oncology drugs, targeted therapies and chemotherapy. The most interesting data presented was from the Phase II NSCLC combination trial with pembrolizumab, in which responses were observed in patients with undetectable levels of PD-L1. The only disappointing data was from the Phase II study in triple negative breast cancer (TNBC) in which there was a limited efficacy signal, possibly because only four out of 18 patients had Axl-expressing tumours.
  • Axl biomarkers could identify likely responders The data presented at ASCO suggests that expression of the Axl receptor in tumours and/or soluble Axl in the blood could be used to identify those patients that are likely to respond to bemcentinib. The Axl receptor is epigenetically upregulated in many cancers, although not all, so a companion diagnostic test should facilitate the development process and could enhance bemcentinib’s commercial prospects.
  • Further data to be published in H218 All of the Phase II trials are expected to continue as planned, with the possible exception of the TNBC study, and further data from the trials is due to be reported in H218. More mature data with additional patients should provide a better understanding of bemcentinib activity and could pave the way to the initiation of Phase III trials in 2019.
  • Valuation unchanged at NOK52.65/share We maintain our valuation at NOK2,880m ($339m, NOK52.65 per share). The results presented during ASCO are from initial analysis of interim data, and at this stage we see no reason to alter our assumptions. We expect regular share catalysts over the next year as more data is presented and the company discloses its development plans in fibrosis.


27 June 2018

Price (NOK)39.90
Market Cap (NOKm)2.183
Enterprise Value (NOKm)1,854
Shares in issue54.7m
12-month range (NOK)18.60-54.80
Free float57%
Primary exchangeOslo
Other exchangesN/A
Company CodeBGBIO
Corporate clientYes

Company description

BerGenBio is a clinical-stage, drug development company based in Bergen, Norway and Oxford, UK. It is developing innovative anti-cancer therapies that act on the promising Axl signalling pathway. The lead oncology compound, BGB324, is in a number of Phase II trials.


Mick Cooper PhD
+44 (0) 20 3637 5042

Lala Gregorek
+44 (0) 20 3637 5043

The interim data from the six Phase II studies in various oncology indications published during ASCO continue to support the broad development programme of bemcentinib (BGB324). They also highlighted that Axl biomarkers could be important in identifying those patients likely to respond well to bemcentinib.

It should be noted that the data presented were only from the preliminary analysis of interim data from a limited number of patients, and as such is not complete. The true value of bemcentinib will become clearer when more mature data in more patients is analysed more deeply. The current small patient numbers might give an unrepresentative impression of bemcentinib’s activity. It is also possible that the overall response rate will increase in time as the data matures. It takes time for tumours to respond to treatment; and immuno-oncology therapies can appear to make tumours grow initially, when in fact the infiltration of immune cells might obscure a reduction in tumour cells within a lesion.

Having said that, there were promising signals within the data. In particular, the response rate among non-small cell lung cancer (NSCLC) patients treated with bemcentinib in combination with pembrolizumab (Merck’s Keytruda) suggests that bemcentinib could increase the proportion of NSCLC patients that might benefit from treatment with pembrolizumab. Also, BerGenBio appears to have identified biomarkers that may identify patients likely to respond to bemcentinib treatment.

Data presented during ASCO

BerGenBio is conducting a broad Phase II programme with bemcentinib to gain a better understanding of its potential, as shown in Exhibit 1. During ASCO, the first efficacy data from the trials in NSCLC, triple negative breast cancer (TNBC) and melanoma was presented, with updated results from the other Phase II studies.

Exhibit 1: BerGenBio’s portfolio of products
Source: BerGenBio

NSCLC Phase II trial in combination with pembrolizumab

Interim data from the Phase II trial in second-line NSCLC in combination with pembrolizumab were presented in a poster and are particularly promising. They suggest that bemcentinib can enhance the activity of pembrolizumab.

The data presented below (Exhibits 2 and 3) is preliminary data from 24 patients. At the data cut off point for the preparation of the posters, the RECIST best response data in the waterfall plot (Exhibit 2) is from 15 patients; the biomarker subgroup analysis (Exhibit 3) is based on data from the same group of 15 patients.

Of particular note is the overall response rate (ORR) and disease control rate (DCR) in those patients with very low levels of/no detectable PD-L1 in their tumours. Patients with tumours with high PD-L1 expression are more likely to respond better to pembrolizumab than those with low expression in their tumours. For this reason, pembrolizumab is not approved as a single agent in patients with PD-L1<1% (PD-L1 negative) tumours. Interestingly, this dichotomy has not been the case in this study at the moment; the ORR is 29% in the seven-patient PD-L1<1% group and 20% in the five-patient PD-L1≥1% group. The initial biomarker data also suggests that Axl expression in the tumour could identify those patients likely to respond to bemcentinib.

Exhibit 2: Waterfall plot of best responses by patients in Phase II NSCLC trial with pembrolizumab
Source: BerGenBio; Note: TPS- tumour proportion score; The mixed response (MR) was recorded where the target lesions reduced in size, but other unmeasured lesions appeared or grew.
Exhibit 3: Subgroup analysis of best response by biomarker expression in Phase II NSCLC trial with pembrolizumab
Source: BerGenBio. Note: ORR – overall response rate; DCR – disease control rate

For comparison, the ORR in the KEYNOTE 010 Phase III trial in the same setting was 18% with 2mg/kg of pembrolizumab every three weeks (200mg every three weeks was used in the trial with bemcentinib) in patients with PD-L1≥1% tumours. This is a comparable to the ORR of 20% for all 15 patients analysed during the interim analysis, but this also includes PD-L1 negative patients.

Also, the ORR in PD-L1-negative patients was only 8.1% in the KEYNOTE 001 Phase I study with 495 NSCLC patients. This compares to an ORR of 29% in the current trial so far, though it should be noted that 66% of the NSCLC patients in the KEYNOTE 001 trial had already received at least two lines of systemic treatment (≥4 lines in 21% of patients), whereas all the patients in the current trial are in the second-line settings. The KEYNOTE 001 trial provides an indication of the prevalence of PD-L1-negative NSCLC cases as well, 39.2% of all patients screened and 22.0% of all patients treated were classed as having PD-L1-negative NSCLC. If the initial data from the NSCLC trial with bemcentinib and pembrolizumab is representative of the true efficacy, these patients could benefit from the combination.

Since the ASCO meeting, BerGenBio has reported that the number of PR has increased to four (and could increase further as a number of patients are still being treated with the combination of bemcentinib and pembrolizumab). This means that the pre-specified efficacy endpoint for the first stage of the Phase II trial – at least four clinical responses from the first 22 treated patients – has been met, and that the trial will advance into the second stage and recruit an additional 24 patients without any changes to the clinical trial protocol.

TNBC Phase II trial in combination with pembrolizumab

The TNBC Phase II trial showed limited signs that the combination of bemcentinib and pembrolizumab was an efficacious treatment in this indication (Exhibit 4). There was only one PR out of the 18 patients analysed, which contrasts greatly with the observations from the NSCLC study. This result could be related to the fact that 12 out of 15 patients analysed had tumours without detectable PD-L1 (PD-L1<1%), and 14 out of 18 patients had tumours with no detectable Axl expression. It is surprising that so few women in the trial had tumours which did not express Axl as previous studies have indicated that c 50% of breast cancer patients have Axl-expressing tumours.

The detailed analysis of the interim data will determine whether BerGenBio decides to advance the study into the second-stage of the Phase II trial. If the company does continue the trial, it might make it a recruitment criterion that patients have Axl expressing tumours.

Exhibit 4: Waterfall plot of best responses in TNBC Phase II
Source: BerGenBio

AML/MDS Phase II trial

The additional data from the Phase II study in relapsed and refractory acute myeloid leukaemia (AML) and myelodysplastic syndrome (MDS) continues to demonstrate promising levels of efficacy (Exhibit 5). But, the most interesting aspect of the new data presented in a poster and poster discussion at ASCO related to the strong correlation between low levels of the soluble Axl (sAxl, shed, inactive Axl) biomarker and the activity of bemcentinib (Exhibit 6). The use of bemcentinib with a companion diagnostic test could facilitate the route to market and give BerGenBio a significant competitive advantage over Astellas. The latter is developing gilteritinib (Axl and FLT3 inhibitor) primarily in AML with FLT3 mutated patients (around 25% of AML patients), but is also exploring the broader use of gilteritinib in AML.

Exhibit 5: Waterfall plot of best responses by patients in Phase II AML/MDS trial
Source: BerGenBio. Note: The assessment of clinical response is based on various clinical factors and is not based solely on the % change in blast count.

As in the case of the data from the NSCLC combination trial with pembrolizumab, the data presented in Exhibits 5 and 6 are based on results from the 37 monotherapy patients included in the study to date and analysed, as at the cut-off date for the preparation of the posters. The results from the bone marrow analysis in Exhibit 5 are from 18 patients; biomarker subgroup analysis in Exhibit 6 includes two more patients.

Exhibit 6: Subgroup analysis of best response by biomarker expression in Phase II AML/MDS trial
Source: BerGenBio.

The response rates in those patients classified as having low soluble Axl (sAxl) in the blood are impressive (Exhibit 6, 7) and suggest that sAxl can be used to select those patients that are likely to benefit from treatment with bemcentinib. The potential of sAxl as a companion diagnostic will have to be validated in Phase III clinical trials, which at the same time will confirm the efficacy and safety of bemcentinib for the treatment of AML/MDS.

Exhibit 7: Levels of sAxl in blood in responders to bemcentinib and the change in sAxl levels in responders before and after treatment
Source: BerGenBio. Note CRi – complete response with incomplete haematologic recovery

There is a clear scientific rationale for using sAxl as a biomarker with bemcentinib. sAxl is the extracellular domain of the Axl receptor, which is shed following the cleavage of the receptor. The shedding of the extracellular domain is a known mechanism of downregulating membrane receptors such as Axl. Under normal physiological conditions or in tumours that are not dependent on the Axl signalling pathway, there is a relatively high level receptor shedding. In contrast, when the Axl receptor is bound by the ligand GAS6, as occurs in a tumour in which Axl signalling is active, the receptor is stabilised and less likely to be cleaved. This means that there is an inverse relationship between levels of the activated Axl receptor and sAxl in the blood; i.e. patients with Axl-driven AML/MDS should have lower levels of serum sAxl, and are also likely to respond to treatment with bemcentinib.

Consistent with this hypothesis, levels of sAxl should increase after treatment with bemcentinib as it inactivates the Axl receptor, leading to increased cleavage of the receptor. This is indeed what occurs: there is an increase in sAxl in responders in this trial (Exhibit 7), as was also the case in the Phase II NSCLC trial in combination with pembrolizumab, and the Phase II melanoma trial.

After ASCO, there was the European Haematology Association (EHA) meeting, at which BerGenBio presented some additional data from the Phase II study in AML/MDS. Of note was the immunological data, which indicated that there had been a diversification of the T-cell repertoire in seven of the eleven patients assessed following bemcentinib monotherapy, and that there had also been a similar diversification of the B-cell repertoire in two of those patients (Exhibit 8). These data suggest that some of the benefit observed in the Phase II study in NSCLC in combination with pembrolizumab was caused by bemcentinib broadening the immune response so that more tumour antigens are recognised by the immune system.

Exhibit 8: The diversification of B-cell (IGH) and T-cell receptor (TCR) repertoire in patients receiving bemcentinib monotherapy
Source: BerGenBio. Note PB- Peripheral blood; BM – Bone marrow

Metastatic melanoma randomised Phase II trial

Updated data from the Phase II trial in metastatic melanoma was also presented in a poster at ASCO. The trial has a cross-over design with bemcentinib being used in combination with either pembrolizumab or dabrafenib (Novartis’ Tafinlar) plus trametinib (Novartis’ Mekinist) in up to 92 newly-diagnosed patients (Exhibit 9).

Exhibit 9: Clinical trial design of Phase II trial in melanoma
Source: BerGenBio  Note: RP2D – recommended Phase II dose
Exhibit 10: Waterfall plot of best responses by patients in Phase II melanoma trial
Source: BerGenBio  Note: pembro – pembrolizumab; D/T – dabrafenib/trametinib

So far data from 19 patients has been published (Exhibit 10). 17 of patients have achieved disease control, with two complete responses, although it is too soon to draw any meaningful conclusions about the efficacy of the various drug combinations from the data. Having said that, it is very reassuring that all drug combinations have been well tolerated so far. It is often not possible to use two drugs in combination because of adverse events, but the specificity of bemcentinib means that this has not been a problem with all drug combinations with bemcentinib that have been tested to date.

NSCLC Phase II combo trials with erlotinib or docetaxel

An update on the remaining two Phase II NSCLC trials was provided at a reception during ASCO, which confirmed that both are progressing well with some promising initial responses.

In the trial studying bemcentinib in combination with erlotinib (Tarceva), BerGenBio had already reported some long term responses in the second-line setting:

  • Two out of eight patients had stable diseases (SD) for about one year after receiving bemcentinib monotherapy;
  • Two patients achieved partial responses (PR) and five SD out of a total of 17 patients after treatment with bemcentinib in combination with erlotinib after they had actively progressed on an EGFR inhibitor, including one durable response of over 2.5 years.

The company has now published the initial data from the first-line setting in patients that had been stable on erlotinib for over 12 weeks (Exhibit 11). From the six patients treated so far, there is one PR and 4 SD. Data from this trial suggests that bemcentinib can increase the sensitivity of a tumour to erlotinib or reverse resistance in some patients.

In the Phase II NSCLC study in combination with docetaxel, BerGenBio confirmed that three PR and three SD had been observed in the first seven evaluable patients (Exhibit 12). These patients had previously been treated with a range of treatments including immuno-oncology therapies.

Exhibit 11: Waterfall plot of best responses by patients in Phase II NSCLC trial in combination with erlotinib (Tarceva)
Source: BerGenBio
Exhibit 12: Waterfall plot of best responses by patients in Phase II NSCLC trial in combination with docetaxel
Source: BerGenBio

Valuation and Financials

We are maintaining our valuation of BerGenBio at NOK2,880m ($339m) or NOK52.65 per share. While the new data is largely supportive of bemcentinib’s potential in a broad range of oncology settings, we maintain our conservative stance and will review our valuation once the data has matured. Our valuation excludes any consideration for bemcentinib/BGB149 in fibrosis indications (see Update note dated 9 May 2018) or the antibody-drug conjugate BGB601 that is due to enter clinical development within a year.

There are no changes to our financial estimates.

Exhibit 13: Summary of financials
Source: Company, Trinity Delta


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