The TSX, TSXV, CSE and NEO exchanges list more than 4,000 companies, a daunting number for any investor to sort through.
Parsing prospective opportunities from also-rans begins with narrowing down your investable universe, leaving only companies whose operations mark a clear path forward.
In the interest of expediting that task for TMH readers, our series, Anatomy of a Flagship Asset, introduces you to the most promising projects and products creating value in the Canadian stock market.
Next up is Oncolytics Biotech (TSX:ONC), a healthcare company developing pelareorep, an intravenously delivered immunotherapeutic agent that activates the immune system’s cancer defenses and makes tumors more susceptible to oncology treatments.
Improving the body’s innate cancer-fighting abilities
Pelareorep is a patented isolate of a naturally occurring, non-pathogenic, double-stranded RNA virus known as reovirus. The company is developing it as a treatment for solid tumors and hematological malignancies by co-opting our immune system to kill cancer cells.
Cancers spread because their cells trick the immune system into thinking they’re healthy, which prevents it from infiltrating tumors and blunts the impact of a wide range of drug classes misunderstood to be attacking normal cells.
This is where immunotherapy enters the picture, enlisting the immune system to treat a disease by enhancing, inducing or suppressing immune response. Immuno-oncology, focused on cancer, seeks to combat cell mutations by unveiling their non-threatening disguise and slowing their growth, making them more susceptible to our internal defenses.
Pelareorep is currently being manufactured at clinical scale under Oncolytics Biotech’s commercial supply agreement with MilliporeSigma (formerly Sigma-Aldrich), the life science wing of Merck KGaA. Commercial-scale production will follow regulatory approval.
How pelaroerep trains the body to kill cancer cells
Cancer cells infected with pelareorep release inflammatory cytokines. This activates natural killer cells and promotes their migration, alongside dendritic cells and T-cells, through the tumor microenvironment, aiding in immune cell-mediated cancer cell death.
Following cancer cell death, the release of tumor- and viral-associated antigens are taken up by antigen presenting cells (APCs). APCs then present these antigens to T-cells, effectively training the immune system to recognize and kill cancer cells, preventing relapse and increasing overall survival.
Pelareorep has demonstrated synergies with immune checkpoint inhibitors and may be beneficial with other approved oncology treatments, such as CAR T therapies, bispecific antibodies, and CDK4/6 and PARP inhibitors, paving the way for multiple revenue runways upon regulatory approval.
Promising breast cancer research
Oncolytics Biotech is conducting and planning clinical trials examining pelareorep in combination with checkpoint inhibitors and targeted therapies as it advances towards a registration study in metastatic breast cancer.
Pelareorep yielded a 2x increase in median overall survival – as well as robust increases in progression-free survival and overall response rate when combined with Paclitaxel – in a phase-2 breast cancer trial.
A registration study could address a significant need, as current therapies do not produce a meaningful survival advantage and new breast cancer cases surpassed 2 million in 2020, according to Cancer.net.
A potentially viable solution for pancreatic cancer
With a dismal five-year survival rate of 11.5 per cent in the United States, according to the U.S. National Cancer Institute, and cases forecast to grow to 135,000 in major markets (U.S., Europe, Japan) by 2028, metastatic pancreatic cancer patients are in dire need of more effective treatments.
To remedy this, Oncolytics Biotech is conducting an ongoing study of combinations between pelareorep and other strategic medications, including Atezolizumab, Gemcitabine and Nab-paclitaxel. Interim data has been positive, with an objective response rate of 69 per cent in evaluable patients, well above chemotherapy’s average of 25 per cent.
High-profile partnerships
Oncolytics Biotech is pursuing a clinical development strategy for pelareorep focused on:
- Regulatory approval based on compelling metastatic breast cancer survival data and its potential synergies with checkpoint approved inhibitors
- Expanding pelareorep into commercially attractive treatment areas with pharmaceutical partners
The company’s current roster of partners is of the highest order as it develops clinical studies targeting metastatic breast cancer, early-stage breast cancer, multiple myeloma and gastrointestinal cancer, including pancreatic, colorectal, and anal:
Backed by 236 global patents, major industry players, and a promising alternative to legacy therapies, Oncolytics Biotech is rapidly unraveling tumors’ ability to co-opt the immune system, opening patients up to the benefits of immunotherapies that have been limited to date.
Future catalysts
Considering that it can take more than a decade for new drug approvals, Oncolytics Biotech remains best-suited for long-term investors prepared to withstand the volatility of an unprofitable, research-based company.
Shareholders should pay close attention to clinical study updates, which may bring spikes in market sentiment, as well as overreactions to the downside to take advantage of more attractively priced shares.
Volatility aide, the company’s breast cancer program is now ready for phase 3, making its trajectory toward marketable, life-enhancing immunotherapies stronger than ever. This paints its stock’s 86 per cent losses since inception as a sign of excessive pessimism, justifying how an allocation could prove worthwhile over time.
Continue your due diligence by reading Oncolytics Biotech’s investor presentation for June 2023.
The material provided in this article is for information only and should not be treated as investment advice. For full disclaimer information, please click here.
