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Tango Therapeutics (TNGX) popped 5-6x instances a number of days after I wrote a impartial article on July 26. There was no information. In my article I had mentioned that whereas there are issues to love on this nanocap developer of artificial deadly inhibitor of PRMT5 or protein arginine methyltransferase 5, and whereas preclinical indications had been constructive, there was no medical efficacy knowledge but, which was retaining the inventory stagnant. 2 weeks later, on August 8, the inventory went up like a rocket.
What occurred?
If you happen to take a look at the TNGX timeline, you’ll not discover something on August 8. Positive, they noticed the spike and hurried to make hay whereas the solar shone, by the use of pitching for a $80mn providing on August 10. Nonetheless, there isn’t any press launch, no knowledge drop and no information to point why the inventory would go up so a lot on that individual day.
For a proof, you need to take a look at Mirati’s (MRTX) timeline. On August 9, Mirati got here out with a press release stating that its personal artificial lethality expertise produced proof of idea knowledge, each preclinical and medical. Mirati introduced that knowledge from a first-in-human Section 1/2 medical trial of MRTX1719, a PRMT5 / methylthioadenosine (MTA)-cooperative inhibitor evaluated in methylthioadenosine phosphorylase (MTAP) deleted cancers, demonstrated that “blocking PRMT5-MTA complex is a rational and differentiated approach to treat cancers harboring MTAP deletion.” Within the small, 18 affected person research, this was the information we had been offered:
There have been six confirmed goal responses noticed within the Section 1 research together with one affected person who achieved a response which subsequently confirmed post-data cutoff
MRTX1719 achieved obvious full PRMT5 inhibition in MTAP deleted tumor cells at a dose of 200 mg QD as evidenced by pretreatment and on-treatment tumor biopsies of the PRMT5 biochemical biomarker symmetric dimethyl arginine (SDMA)
It was notable that 4 sufferers had been on remedy for a number of cycles earlier than experiencing an preliminary goal response, with their tumors persevering with to lower in measurement over the course of remedy.
These findings counsel that tumor response might proceed to deepen over time indicating the significance of evaluating tumor response kinetics and response charges throughout a broader affected person inhabitants with longer observe up.
MRTX1719 was well-tolerated with no dose limiting toxicities noticed at dose ranges as much as 400mg QD. Not one of the sufferers handled with MRTX1719 skilled dose-limiting hostile occasions related to first technology PRMT5 inhibitors comparable to thrombocytopenia, anemia or neutropenia.
On the again of this reasonably constructive knowledge, Mirati inventory went up about 30%; nevertheless, TNGX inventory doubled in a single day, persevering with to realize even additional. That TNGX did a lot better than MRTX on knowledge from MRTX needs to be accounted for by the truth that whereas MRTX1719 is only one amongst many packages in Mirati’s huge pipeline which incorporates an authorized drug, PRMT5-MTA inhibition utilizing artificial lethality is Tango’s core program. Additionally, MRTX at the moment had about 10x the market cap of TNGX, so a constructive occasion had a stronger impact on the smaller inventory with better concentrate on the expertise inflicting that constructive occasion.
Between October 5 and October 13, TNGX inventory dropped once more, almost halving in a single day, and in case you search for a proof, you will not discover it on TNGX timeline. It’s a must to look elsewhere once more. Three issues occurred throughout this one week interval:
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Sanofi confirmed takeover interest in MRTX, a perpetual potential M&A goal – Oct 5
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BMY agreed to acquire MRTX for $4.8bn, with MRTX1719 being a key a part of the rationale, together with Krazati – Oct 8
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Amgen produced proof of idea data from its personal PRMT5-MTA program, AMG 193 – Oct 13
To place this in context, artificial lethality has been besieged by a troubling lack of knowledge. GSK was a significant participant within the area in 2022, together with Amgen, Pfizer, JNJ and Servier amongst huge pharma. Nonetheless, after GSK/Epizyme’s PRMT5 inhibitor failed to provide good knowledge, GSK moved away from artificial lethality, a expertise it had as soon as known as one among its 4 key oncology focus areas. GSK selected to not decide in for Ideaya’s PRMT5 inhibitor IDE397, and in addition discontinued inner analysis tasks utilizing this expertise. [Ideaya continues to collaborate with Amgen].
Earlier in 2021, one other early PRMT5 concentrating on remedy developer Prelude Therapeutics produced disappointing outcomes, getting just one remission in a forty five affected person trial. So this was the sorry state of affair with artificial lethality.
BMY’s acquisition of MRTX may have put the main focus again on artificial lethality had MRTX1179 been the core of the acquisition, nevertheless, Amgen’s lackluster knowledge as soon as once more confirmed that artificial lethality nonetheless had an information downside.
The info Amgen put up on October 13 showed the next in 31 sufferers:
Amongst 31 sufferers who acquired not less than one scan after beginning remedy, 5 sufferers with completely different tumor varieties skilled a partial response (PR), 14 sufferers had secure illness (SD), and 12 sufferers had illness development. Notably, the PRs had been sturdy and had been ongoing on the time of knowledge evaluation, when sufferers had been on remedy for 140-275 days.
As well as, 9 sufferers with SD skilled a point of tumor shrinkage, though not sufficient to qualify these results as PRs. “The mechanism of action of this type of drug may be slow, so we expect the antitumor response to also be slow,” mentioned Rodon [Jordi Rodon, MD, PhD, data presenter,] . “It is possible that with longer follow up, those cases of minor tumor shrinkage may achieve the status of PR.”
Now, within the 2021 Prelude trial, the data confirmed that there was one CR and 5 SD. In fact, first technology PRMT5 inhibitors confirmed bone marrow toxicity which Amgen fortunately lacked. Nonetheless, it does seem that regardless of the general broad attain of the remedy (excessive ORR), that the market should have been anticipating increased ranges of medical profit, together with not less than some CRs. Whereas the information presenter mentioned by the use of a proof that heavy pretreatment on this affected person inhabitants might have occulted remedy impact, the market was in all probability not shopping for it.
And who did the market punish for Amgen’s poor knowledge? Tango Therapeutics.
In fact, Amgen, which was buying and selling at $280 on October 13, dropped precipitously to $255 instantly after the information, however it did not go down by half, like Tango did, as a result of in contrast to Tango, PRMT5 will not be anyplace close to Amgen’s core focus.
These are my speculations, in fact, however that’s what we’re alleged to do – speculate, however with knowledge backing up such hypothesis.
Financials
TNGX has a market cap of $950mn and a money steadiness of $360mn. Analysis and growth bills had been $27.1 million for the three months ended September 30, 2023, whereas normal and administrative bills had been $9.2 million. At that charge, the corporate has a stable money runway of some 9-10 quarters.
Backside line
Sure, TNGX has gone up on information from rival firms; nevertheless, looking back, the MRTX PRMT5 knowledge wasn’t all that spectacular both. The artificial lethality house wants extra derisking, which, for TGNX, can solely come from its personal clearly constructive knowledge, if it may get it. Till then, contemplate TGNX overvalued.