Post by Yelk on Feb 21, 2015 20:55:30 GMT
MEI Pharma: We could be sitting at the feet of a giant statue.
My Initial Due Diligence Report Feb 21, 2015
About MEI Pharma
MEI Pharma, Inc. (Nasdaq: MEIP) is a San Diego-based oncology company focused on the clinical development of novel therapies for cancer. The Company's lead drug candidate is Pracinostat, a potential best-in-class, oral HDAC inhibitor currently being developed for MDS and AML. In August 2014, the Company completed enrollment in a randomized, placebo-controlled Phase II study of Pracinostat in combination with azacitidine in patients with previously untreated intermediate-2 or high-risk MDS. The Company plans to unblind the study and report topline data in March 2015. MEI Pharma is also developing ME-344, a mitochondrial inhibitor currently in a Phase Ib study in combination with topotecan in patients with small cell lung or ovarian cancer who failed initial therapy. In September 2013, the Company further expanded its pipeline of drug candidates with the acquisition of PWT143, a highly selective PI3K delta inhibitor.
Current catalysts:
~Financing freshly out of the way
~Increasing buy upgrades and increasing institutional ownership
~Top line data from Phase II study in front line MDS (March)
~Outstanding clinical data
~Rich pipeline
~Easy to use drug meeting unmet needs, safe, orphan status
~52 week low within one month
2015 Catalysts and Milestones:
~Top line data from Phase II study in front line MDS (March)
~Full data set from Phase II study in front line MDS (June)
~Initiation of Phase III study in front line elderly AML (June)
~ME-344 Data from Phase Ib trial in small cell lung & ovarian cancers
~PWT 143 Initiation of first in human study
Recent Presentation: www.meipharma.com/sites/default/files/MEIP%20Analyst%20%26%20Investor%20Event%20%28Dec%202014%29.pdf
Financials:
~Cash: 80M
~Q Burn : 6M
~Market Cap: 180M
~Float: 10M
~Short interest 2.5%
~Insider buys: 100%
Analysts Highlights
~Institutional holdings: 70%. Increased 16% in the last 20 days.
~Roth Capital - Buy $14 (Dec 18, 2014)
~Wells Fargo - Outperform $10.50 (Feb 6, 2015)
~BofA/Merrill – Buy $9 (Feb 20, 2015)
~Cantor Fitzgerald – Buy $14 (Sep 2014)
Science and trials. (Italic is quoted)
Reference: seekingalpha.com/article/2837226-mei-pharma-a-rare-hidden-gem-with-impressive-clinical-data?page=2
“The use of HDAC inhibitors in cancer is not a new idea. Acetylation of histones is associated with gene expression, while deacetylation is associated with gene repression. Countless studies have illustrated a global loss of acetylation in human tumors resulting in aberrant gene regulation. Furthermore, overexpression of HDACs have been correlated with poor prognosis in numerous tumor types. Several compounds have made their way through clinical trials with limited success as single agents, with vorinostat and romidepsin, FDA approved for refractory cutaneous and peripheral T cell lymphoma, the only successful HDAC inhibitors to date. Importantly, compared to other HDAC inhibitors Pracinostat is considered best-in-class with a superior pharmacokinetics and toxicity profile. The bioavailability of the drug is thought to make Pracinostat more clinically active than other HDAC inhibitors. In fact, Dr. Guillermo Garcia-Manero, Chief of MDS and Deputy Chair of Translational Research at MD Anderson Cancer Center is heading up the Pracinostat studies and has stated that the drug's favorable pharmacokinetics profile is likely why this HDAC inhibitor has been more successful than others in the clinic.”
Elderly AML is an unmet need currently as it is a known fact that the elderly cannot undergo usual strenuous cancer treatments. The Phase II study for elderly AML, which enrolled 41 patients at 15 sites who received both Pracinostat and Azacitidine with a primary endpoint of complete response rate went exceptionally well. Important to note, the patient population had a median age of 76 and very complex cytogenetics profiles resulting in poor prognosis.
”After an interim response assessment, a remarkable 45% of patients had achieved the primary endpoint of a complete response. Another 10% achieved a partial response and 12% had stable disease. The time to response was also very fast, occurring generally in the first two cycles of treatment and durable. No patient that has achieved a clinical response has progressed to date with six patients on study for over 230 days and counting.”
Typically the complete response time in this population is 8-9% and takes about 6-8 months to achieve. Comparing those results it is easy to see why I am excited for the P3 trial which will start in the summer of 2015. The FDA agreed complete response is an appropriate endpoint for full approval and I agree with analysts from P2 data we will see positive results and full approval for the drug. I want to also mention the drug has received orphan drug status and commercialization is set to start in a few years if P3 goes well.
P2 Trial for MDS (Results March 2015)
“Similar to the results seen in AML, Pracinostat has been just as impressive in treating MDS. The hypomethylation agent Azacitidine is already FDA approved for treating intermediate and high-risk MDS, which showed a clinical response rate (complete and partial) of 16% in Phase III clinical trials and an overall survival benefit. In the pilot Phase II trial combining Pracinostat with Azacitidine there was an impressive 90% complete response rate (9/10 patients). This data led to a randomized Phase II trial at 24 sites evaluating 102 patients randomized 1:1 with Pracinostat and Azacitidine or Placebo and Azacitidine with a primary endpoint of complete response. The data from this trial is expected to be released in March 2015, which would be a significant catalyst if positive.
Perhaps even more impressive is the data that was released on December 22, 2014 from the Phase II clinical trial where Pracinostat is being evaluated in combination with a hypomethylation agent in patients that have previously failed hypomethylation treatment alone. Interim analysis from the first 28 patients revealed three have now achieved clinical responses (1 partial and 2 marrow complete responses) extending the trial into the second phase. Again, the ability for Pracinostat to achieve clinical responses in the most difficult to treat disease cohorts further proves its impressive clinical efficacy.”
MDS and AML market opportunity:
This market is currently growing and there really isn’t any options for treatment. Azacitidine and Daogen current treatments had sales exceeding $1 Billion. With the response from data we have seen and the fact that MEI Pharma owns 100% full rights to compound it would mean significant revenue. The drug is a pill taken 3 times a weak so convenience is not an issue and it is certainly safer. This is a comparable opportunity to CYNAF except we have a much larger pipeline off possibilities.
Rich Pipeline:
“Pracinostat is progressing nicely in numerous clinical trials and has been used to treat over 300 patients to date, establishing important characterization data. Besides MDS and AML, Pracinostat is also being tested in numerous other tumor types and drug combinations. Although, this is the company's most advanced clinical drug, MEI Pharma also is testing ME-344 in a Phase I clinical trial with refractory tumors. This novel compound targets the mitochondria causing cancer cell death and illustrated efficacy in pre-clinical ovarian cancer models. Data presented from the Phase I trial following ME-344 treatment in refractory tumors illustrated 8 of 21 patients achieved stable disease or better, with 5 patients experiencing progression free survival at least twice as long as their prior treatment. Remarkably, one patient with small cell lung cancer had a partial response and has remained on the drug for over 2 years. Another drug candidate PWT143 is a PI3K inhibitor, which has shown impressive pre-clinical data in hematologic cancers. MEI Pharma expects to file an IND application with the FDA soon for this compound. Long story short, MEI Pharma has a healthy drug pipeline with several compounds being tested in numerous indications.”
My Evaluation and recommendation:
I am profoundly impressed by the amount of well renowned hedge funds, individual investors, institutions and insider holdings for the stock of this company due to the outstanding performance of recent trials. The pipeline is rich and there is much to happen in 2015. Current valuation from $5.50 shows this to be a potential easy multi bagger. Market potential for drug sits very, very conservatively at 500M. If data continues to be positive we could some very big players come into the field. We already have AML P3 study with orphan drug status moving forward full steam with fresh off the press financing and strong balance sheet for 80M to mitigate downside should March data be negative. If P2 trial is positive in March (which I am expecting) combined with full data and P3 starts in June we could see a massive upside.
I do not think it is too late to jump into this stock as I see a possible 50% increase before March data. There is mitigated risk for holding through data with the strong cash position of $80M and great P3 trial to look forward too. The rich pipeline mitigates this further. If P2 results are positive the stock could double in the next month. We could be sitting at the feet of a giant statute.
My Initial Due Diligence Report Feb 21, 2015
About MEI Pharma
MEI Pharma, Inc. (Nasdaq: MEIP) is a San Diego-based oncology company focused on the clinical development of novel therapies for cancer. The Company's lead drug candidate is Pracinostat, a potential best-in-class, oral HDAC inhibitor currently being developed for MDS and AML. In August 2014, the Company completed enrollment in a randomized, placebo-controlled Phase II study of Pracinostat in combination with azacitidine in patients with previously untreated intermediate-2 or high-risk MDS. The Company plans to unblind the study and report topline data in March 2015. MEI Pharma is also developing ME-344, a mitochondrial inhibitor currently in a Phase Ib study in combination with topotecan in patients with small cell lung or ovarian cancer who failed initial therapy. In September 2013, the Company further expanded its pipeline of drug candidates with the acquisition of PWT143, a highly selective PI3K delta inhibitor.
Current catalysts:
~Financing freshly out of the way
~Increasing buy upgrades and increasing institutional ownership
~Top line data from Phase II study in front line MDS (March)
~Outstanding clinical data
~Rich pipeline
~Easy to use drug meeting unmet needs, safe, orphan status
~52 week low within one month
2015 Catalysts and Milestones:
~Top line data from Phase II study in front line MDS (March)
~Full data set from Phase II study in front line MDS (June)
~Initiation of Phase III study in front line elderly AML (June)
~ME-344 Data from Phase Ib trial in small cell lung & ovarian cancers
~PWT 143 Initiation of first in human study
Recent Presentation: www.meipharma.com/sites/default/files/MEIP%20Analyst%20%26%20Investor%20Event%20%28Dec%202014%29.pdf
Financials:
~Cash: 80M
~Q Burn : 6M
~Market Cap: 180M
~Float: 10M
~Short interest 2.5%
~Insider buys: 100%
Analysts Highlights
~Institutional holdings: 70%. Increased 16% in the last 20 days.
~Roth Capital - Buy $14 (Dec 18, 2014)
~Wells Fargo - Outperform $10.50 (Feb 6, 2015)
~BofA/Merrill – Buy $9 (Feb 20, 2015)
~Cantor Fitzgerald – Buy $14 (Sep 2014)
Science and trials. (Italic is quoted)
Reference: seekingalpha.com/article/2837226-mei-pharma-a-rare-hidden-gem-with-impressive-clinical-data?page=2
“The use of HDAC inhibitors in cancer is not a new idea. Acetylation of histones is associated with gene expression, while deacetylation is associated with gene repression. Countless studies have illustrated a global loss of acetylation in human tumors resulting in aberrant gene regulation. Furthermore, overexpression of HDACs have been correlated with poor prognosis in numerous tumor types. Several compounds have made their way through clinical trials with limited success as single agents, with vorinostat and romidepsin, FDA approved for refractory cutaneous and peripheral T cell lymphoma, the only successful HDAC inhibitors to date. Importantly, compared to other HDAC inhibitors Pracinostat is considered best-in-class with a superior pharmacokinetics and toxicity profile. The bioavailability of the drug is thought to make Pracinostat more clinically active than other HDAC inhibitors. In fact, Dr. Guillermo Garcia-Manero, Chief of MDS and Deputy Chair of Translational Research at MD Anderson Cancer Center is heading up the Pracinostat studies and has stated that the drug's favorable pharmacokinetics profile is likely why this HDAC inhibitor has been more successful than others in the clinic.”
Elderly AML is an unmet need currently as it is a known fact that the elderly cannot undergo usual strenuous cancer treatments. The Phase II study for elderly AML, which enrolled 41 patients at 15 sites who received both Pracinostat and Azacitidine with a primary endpoint of complete response rate went exceptionally well. Important to note, the patient population had a median age of 76 and very complex cytogenetics profiles resulting in poor prognosis.
”After an interim response assessment, a remarkable 45% of patients had achieved the primary endpoint of a complete response. Another 10% achieved a partial response and 12% had stable disease. The time to response was also very fast, occurring generally in the first two cycles of treatment and durable. No patient that has achieved a clinical response has progressed to date with six patients on study for over 230 days and counting.”
Typically the complete response time in this population is 8-9% and takes about 6-8 months to achieve. Comparing those results it is easy to see why I am excited for the P3 trial which will start in the summer of 2015. The FDA agreed complete response is an appropriate endpoint for full approval and I agree with analysts from P2 data we will see positive results and full approval for the drug. I want to also mention the drug has received orphan drug status and commercialization is set to start in a few years if P3 goes well.
P2 Trial for MDS (Results March 2015)
“Similar to the results seen in AML, Pracinostat has been just as impressive in treating MDS. The hypomethylation agent Azacitidine is already FDA approved for treating intermediate and high-risk MDS, which showed a clinical response rate (complete and partial) of 16% in Phase III clinical trials and an overall survival benefit. In the pilot Phase II trial combining Pracinostat with Azacitidine there was an impressive 90% complete response rate (9/10 patients). This data led to a randomized Phase II trial at 24 sites evaluating 102 patients randomized 1:1 with Pracinostat and Azacitidine or Placebo and Azacitidine with a primary endpoint of complete response. The data from this trial is expected to be released in March 2015, which would be a significant catalyst if positive.
Perhaps even more impressive is the data that was released on December 22, 2014 from the Phase II clinical trial where Pracinostat is being evaluated in combination with a hypomethylation agent in patients that have previously failed hypomethylation treatment alone. Interim analysis from the first 28 patients revealed three have now achieved clinical responses (1 partial and 2 marrow complete responses) extending the trial into the second phase. Again, the ability for Pracinostat to achieve clinical responses in the most difficult to treat disease cohorts further proves its impressive clinical efficacy.”
MDS and AML market opportunity:
This market is currently growing and there really isn’t any options for treatment. Azacitidine and Daogen current treatments had sales exceeding $1 Billion. With the response from data we have seen and the fact that MEI Pharma owns 100% full rights to compound it would mean significant revenue. The drug is a pill taken 3 times a weak so convenience is not an issue and it is certainly safer. This is a comparable opportunity to CYNAF except we have a much larger pipeline off possibilities.
Rich Pipeline:
“Pracinostat is progressing nicely in numerous clinical trials and has been used to treat over 300 patients to date, establishing important characterization data. Besides MDS and AML, Pracinostat is also being tested in numerous other tumor types and drug combinations. Although, this is the company's most advanced clinical drug, MEI Pharma also is testing ME-344 in a Phase I clinical trial with refractory tumors. This novel compound targets the mitochondria causing cancer cell death and illustrated efficacy in pre-clinical ovarian cancer models. Data presented from the Phase I trial following ME-344 treatment in refractory tumors illustrated 8 of 21 patients achieved stable disease or better, with 5 patients experiencing progression free survival at least twice as long as their prior treatment. Remarkably, one patient with small cell lung cancer had a partial response and has remained on the drug for over 2 years. Another drug candidate PWT143 is a PI3K inhibitor, which has shown impressive pre-clinical data in hematologic cancers. MEI Pharma expects to file an IND application with the FDA soon for this compound. Long story short, MEI Pharma has a healthy drug pipeline with several compounds being tested in numerous indications.”
My Evaluation and recommendation:
I am profoundly impressed by the amount of well renowned hedge funds, individual investors, institutions and insider holdings for the stock of this company due to the outstanding performance of recent trials. The pipeline is rich and there is much to happen in 2015. Current valuation from $5.50 shows this to be a potential easy multi bagger. Market potential for drug sits very, very conservatively at 500M. If data continues to be positive we could some very big players come into the field. We already have AML P3 study with orphan drug status moving forward full steam with fresh off the press financing and strong balance sheet for 80M to mitigate downside should March data be negative. If P2 trial is positive in March (which I am expecting) combined with full data and P3 starts in June we could see a massive upside.
I do not think it is too late to jump into this stock as I see a possible 50% increase before March data. There is mitigated risk for holding through data with the strong cash position of $80M and great P3 trial to look forward too. The rich pipeline mitigates this further. If P2 results are positive the stock could double in the next month. We could be sitting at the feet of a giant statute.