Is a Viable Treatment for Mesothelioma on the Horizon?

When it comes to life-threatening illnesses, mesothelioma would rank close to the top of the list. This is a sleeper killer, as mesothelioma symptoms may not show up until 20 to 50 years after exposure to asbestos, and after the tumors have started to spread. Mesothelioma comes with an average life expectancy of only 12 to 22 months.

There is no cure for mesothelioma, and asbestos has been outlawed in just about every instance in modern times. Yet, some companies are looking for better ways to treat the disease. Atara Biotherapeutics Inc. (NASDAQ: ATRA) announced on September 8 that the U.S. Food and Drug Administration (FDA) accepted its Investigational New Drug Application for the company to begin its Phase 1 clinical study of ATA2271.

While the ultimate success is still perhaps months or years away, this is Atara’s CAR T therapy targeting mesothelin in a collaboration with Memorial Sloan Kettering Cancer Center as a potential treatment of advanced mesothelioma.

According to the company, ATA2271 has shown evidence of preclinical safety, as well as improved functional characteristics and enhanced antitumor efficacy. Atara’s release also noted that this is the first-ever CAR T therapy that leverages the combination of PD1DNR checkpoint inhibition and 1XX CAR signaling technologies to enter the clinic.

There are no assurances that the in vivo observations will result in a positive outcome in actual human trials. CAR T cell therapies have previously been approved for certain hematologic malignancies, but to date they have not yet proven effective in solid tumor settings.

Atara has been public since 2014, and its market cap before receiving a positive reception was about $1 billion. Atara shares were at $12.91 as of last week, and the move up on Tuesday was to $13.46, and that was followed with another 10% gain to $14.80 on Wednesday. The consensus analyst target price from Refinitiv was $27.44, but that may be greatly skewed because price targets are literally all over the place.

On August 6, 2020, H.C. Wainwright reiterated its Buy rating and raised its target to $26 from $25. On that same day, Stifel maintained its Buy rating and lowed its target to $28 from $30.

One September 9 analyst call stands out with a much greater target price that is also a street high. Canaccord Genuity analyst John Newman has a Buy rating on the stock and says that the news helps to validate its $70 price target. Even in speculative biotechs, it is unusual to see calls of 400% higher.

The street-high target price is based on Newman’s expectation for FDA approval of tab-cel in 2021 (in Phase 3 development for patients with Epstein-Barr virus-associated post-transplant lymphoproliferative disease), with a Biologics License Application (BLA) submission expected by the end of this year. Newman noted:

With ATA2271 Phase 1 trial to be initiated, we look forward to future data readouts, especially on safety and durability, compared to first generation CAR T therapy from Sloan Kettering, which utilizes a CD28 costimulatory domain and does not utilize PD-1 dominant negative receptor technology.

Currently, there are no effective treatments that can overcome mesothelioma, so any effective treatment would be welcomed by patients and also likely would be treated quite well by investors.

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