Shattuck Labs (NASDAQ:STTK) develops bi-functional fusion proteins targeting cancer and autoimmune diseases. Shattuck’s ARC (Agonist Redirected Checkpoint) platform seamlessly integrates checkpoint inhibition with TNF costimulation. The platform has generated over 400 preclinical bi-functional fusion protein drug candidates.
The primary clinical-stage product, SL-172154 (SIRPα-Fc-CD40L), is currently undergoing two Phase 1 clinical trials. The first trial focuses on platinum-resistant ovarian cancer patients, with two cohorts investigating SL-172154 in combination with pegylated liposomal doxorubicin and mirvetuximab soravtansine, an antibody drug conjugate targeting folate receptor alpha. Shattuck’s second clinical development program (NCT05275439) is centered on hematologic malignancies, studying SL-172154 in combination with azacitidine for patients with acute myeloid leukemia (AML) and higher-risk myelodysplastic syndrome (HR-MDS).
Last week, the company reported positive topline data from this trial. Data showed:
– Observed 79% Objective Response Rate (ORR) in frontline HR-MDS patients, primarily with TP53 mutations; initial complete response (CR)/marrow complete response (mCR) rate of 64% –
– Observed 27% initial CR/complete response with incomplete hematologic recovery (CR’i) in frontline TP53m AML patients, and 5/11 evaluable patients achieved stable disease with decreasing blast counts and peripheral blood count improvement, these patients continue on treatment –
– SL-172154 demonstrated an acceptable safety and tolerability profile as a monotherapy and in combination with azacitidine (AZA) –
These results are pretty outstanding, especially the mCR or marrow complete response, which means complete restoration of bone marrow function. Frontline higher-risk myelodysplastic syndrome (HR-MDS) is typically associated with significant bone marrow involvement. Myelodysplastic syndromes (MDS’) are a group of disorders characterized by dysfunctional blood cell production in the bone marrow. In HR-MDS, there is a higher risk of progression to acute myeloid leukemia (AML), and the disease is often more aggressive.
Bone marrow involvement in HR-MDS means that the bone marrow, which is responsible for producing blood cells, is affected by abnormal and dysplastic cells. These abnormal cells can crowd out normal, healthy cells, leading to a decrease in the production of functional blood cells. Bone marrow involvement is a key aspect of the pathology of MDS, influencing the symptoms and complications associated with the disease.
Assessment of bone marrow involvement is an important aspect of diagnosing and monitoring HR-MDS. It is typically evaluated through bone marrow biopsies and aspirates, which allow healthcare professionals to examine the composition of the bone marrow and identify abnormalities in the cell types and their maturation. Thus, in this context, a high rate of patients achieving mCR is a very positive outcome.
In the context of frontline treatment for TP53-mutated AML patients, SL-172154 resulted in a 27% initial complete response (CR’) or complete response with incomplete hematologic recovery (CRi). CRi suggests a substantial reduction in cancerous cells but not a complete normalization of blood cell counts. Additionally, among the evaluable patients, 5 out of 11 experienced stable disease, marked by a decrease in blast counts (immature blood cells) and improvement in peripheral blood counts. Notably, these patients are continuing the treatment, implying a sustained positive response.
The safety profile of SL-172154 also bears mention. As the company noted, “Clinical issues with toxicities, such as destructive anemia, that have hampered other CD47 inhibitors have not been observed with SL-172154.”
The company also has interim data available from SL-172154 in platinum resistant ovarian cancer or PROC. Here, early data showed considerable anti tumor activity that exceeded a recent benchmark study by a large factor. ORR in the study was 27% as against just 4% in the benchmark JAVELIN study using PLD monotherapy, which is one of the two components of the Shattuck study, the other being, of course, SL-172154.
The company is also studying SL-172154 in combination with mirvetuximab soravtansine in a phase 1b study in PROC. Mirvetuximab soravtansine is approved for FRa high PROC. Using SL-172154, the company aims to treat patients with medium or low FRa expression.
Financials
STTK has a market cap of $280mn and a cash balance of $101mn. R&D expenses were $24.2 million for the quarter ended September 30, 2023, while G&A expenses were $5.1 million. At that rate, the company has just enough cash to last them for 3 more quarters. I am surprised they didn’t raise cash on the positive news and bullish rally. I smell an offering just around the corner. That may not necessarily be a bad thing given the data, but any investment needs to take this into consideration.
STTK stock has a high public participation at 37%, followed by institutions at 34% – a relatively small number. FMR and Redmile are key holders; someone from Redmile sits on the board as well. There are a few insider purchases but no sells.
Risks
STTK is in very early developmental stages and that is always a concern despite the early positive data. More critically, it doesn’t really have a lot of cash so expect some much needed fundraising pretty soon. Also, low smart money interest is not a healthy sign.
Bottomline
This unknown company has presented some very positive data in an area of unmet medical need. While the trial was early stage, this deserves watching. But I am not taking any position until they raise cash and settle down, and maybe, hopefully, present data from another later stage trial.
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