J&J's favorite CAR-T developer, currently owned by a Chinese CRO, is laying the groundwork for US IPO
GenScript, the low-profile owner of CAR-T dark horse Nanjing Legend Biotech, is hatching a plan to spin out its famous subsidiary and shoot for a US IPO.
The contract research organization disclosed its proposal in a filing to the Hong Kong Stock Exchange, where it’s been listed since late 2015. With the HKEX’s blessing, Legend Biotech has submitted a draft registration statement to the SEC, it wrote.
Legend was a virtual unknown until it turned up at ASCO in 2017 with early data on its BCMA CAR-T contender showing a 100% objective response rate and a 94% clinical remission rate among a small group of multiple myeloma patients. J&J was so impressed that it dropped $350 million in cash to partner on that program, now JNJ-68284528.
An antigen found on the surface of B cells, BCMA has since become one of the hottest targets in immuno-oncology, with more than two dozen other developers vying for a place in CAR-T, alongside a handful in the CD3 bispecific and the antibody-drug conjugate fields.
Bristol Myers Squibb, through partnership Celgene had with bluebird, has a frontrunner in ide-cel, perhaps better known as bb2121.
Expect continued debate on how J&J and Legend’s candidate measures up. While the mid-stage numbers from the LEGEND-2 study presented at ASH 2018 (88% ORR, 74% complete response rate reported at ASH in 2018) fell from the early, awe-inspiring levels, execs managed to convince the EMA to hand down its prized PRIME designation based on a more encouraging picture painted by CARTITUDE-1. Those latest results, presented at ASH last year, suggested once again a 100% response rate among patients who’ve had a median of five (and at least three) prior treatments.
One thing we know for sure is that Legend had grown to be a major factor in GenScript’s valuation. Following Legend’s big break three years ago, GenScript’s stock price jumped five-fold to HKD30 at its peak. And when an obscure investment firm published a scathing short report accusing Legend of manipulating its early data, its shares nosedived, rebounding only after a staunch defense was issued.
That all sets the operations, led by CEO Yuan Xu and CSO/founder Frank Fan, up for an independent path. But the terms of the spinoff has yet to be determined, GenScript cautioned:
Shareholders and potential investors of the Company should be aware that there is no assurance that the Proposed Spin-off will take place or as to when it may take place.
Investors appeared to have taken that advice. The stock traded down on Tuesday, currently sitting at HKD16.6.