"Flash crash" three times in a year, ALPHAMAB-B's "cancer king" indication still failed | Jianzhi Research

Alphamab-B, this time finally faced the final "trial" of pancreatic cancer.

On the evening of May 28th, Alphamab-B announced that the Phase 3 clinical trial of KN046 (PD-L1/CTLA-4 dual antibody) + chemotherapy for first-line treatment of advanced or metastatic pancreatic ductal adenocarcinoma (PDAC) did not meet the pre-specified statistical endpoint for overall survival (OS).

This means that KN046, as the core pipeline, has clinically failed in the indication of PDAC.

The market had some expectations for the failure of KN046. The company had experienced a significant intraday drop due to information leakage before

After the announcement last night, today Alphamab-B's stock price plummeted by over 55% intraday. The current market value is now below HKD 3 billion.

It is worth noting that the market did have some expectations for the failure of KN046 in pancreatic cancer clinical trials.

On November 14, 2023, shortly after the market opened, Alphamab-B encountered numerous sell-offs, with the stock price plummeting by nearly 30%.

At that time, there were rumors in the market that the latest clinical results of Alphamab-B's KN046 for pancreatic cancer had been leaked in advance, leading to insider funds rushing to sell. The company then issued a statement on abnormal fluctuations during midday: "Confirmed that it is not aware of any reasons for the recent fluctuations in the share price and confirmed that the group's business operations are normal with no significant adverse changes."

However, during the investor meeting held in the afternoon, the company revealed that KN046's Phase 3 clinical trial for PDAC had received a notification from the independent data monitoring committee (iDMC) recommending further collection of OS data until the final OS analysis. The company subsequently issued an announcement after trading hours regarding this event.

Coincidentally, this had already angered some investors.

Rumors were partially confirmed, as the independent data monitoring committee did provide data on that day, and indeed the interim analysis did not meet the market's expectations for efficacy results.

At this point, the market already had expectations that the possibility of KN046 failing in pancreatic cancer had further increased.

Some investment banks also lowered Alphamab-B's target price, for example, CICC reduced Alphamab-B's target price from HKD 9 to HKD 7.4 to reflect increased uncertainty.

However, this is not the first time Alphamab-B has experienced a flash crash From May 17th to 19th, 2023, due to the progression issue of ALPHAMAB-B's lung cancer indication ALPHAMAB-B, it once dropped by over 30%.

The reason for this flash crash was also that the mid-term analysis did not show statistically significant differences in overall survival (OS), and the independent data monitoring committee recommended further data collection.

Core product encounters Waterloo, increasing negative sentiment towards bispecific antibodies?

Among many tumor diseases, pancreatic cancer is known as the "king of cancer", with the most prominent feature being a short survival period for patients, with a five-year survival rate of only about 5%. Conquering pancreatic cancer is a major challenge that attracts innovative pharmaceutical companies.

The failed clinical trial this time was a multicenter, randomized, double-blind, Phase 3 clinical study of KN046-303 in patients with unresectable locally advanced or metastatic pancreatic cancer who had not received systemic treatment. The study planned to enroll 408 subjects in a 1:1 ratio to compare the efficacy and safety of KN046 in combination with albumin-bound paclitaxel versus gemcitabine compared to placebo in combination with albumin-bound paclitaxel versus gemcitabine in the above-mentioned population, with the primary endpoint being overall survival (OS).

Currently, the two core clinical trials of KN046 have failed in pancreatic cancer, while the first-line squamous non-small cell lung cancer is still under follow-up, but the mid-term OS in May 2023 did not show statistical differences. This means that the overall product expectations have significantly decreased.

This has also brought some negative sentiment to the domestic bispecific antibody industry.

Today, another leading bispecific antibody company, Kangfang Biotech, fell by over 10%, while its overseas partner Summit fell by nearly 30%. Last week, Kangfang Biotech's bispecific antibody AK112 (PD-1/VEGF bispecific antibody) Phase 3 clinical trial median progression-free survival (mPFS) and objective response rate (ORR) data sparked controversy, showing a decrease compared to Phase 2 data, leading to market expectations that it may be weaker than competitors (non-head-to-head) and affecting future sales potential.

However, Kangfang's management quickly clarified that the clinical data falling short of expectations was a misinterpretation. They also announced that AK112 has been approved in China for the treatment of locally advanced or metastatic non-squamous non-small cell lung cancer with EGFR-TKI progression.

Nevertheless, setbacks in some bispecific antibody data do not necessarily indicate a discount on the prospects of bispecific antibodies. After all, in 2023, Johnson & Johnson's EGFR/c-Met bispecific antibody achieved top-line data in Phase 3 non-small cell lung cancer clinical trials, with a peak sales expectation of $5 billion Innovative drug failures are common occurrences. For investors, investing in innovative drugs is based on publicly available information to assess the risk-return ratio of the investment. However, in the investment of innovative drugs, any lack of integrity by a company can lead to misjudgments by investors and result in significant losses.

Therefore, voting on the credibility of a company is also an extremely important aspect