Apogee Therapeutics (NASDAQ:APGE) has been able to achieve the first milestone in the advancement of its drug candidate APG777, which is being developed to treat patients with 1st-line moderate-to-severe Atopic dermatitis [AD]. It dosed the first person for a phase 1 study and expects initial subcutaneous pharmacokinetic and safety data to be released from healthy volunteers in mid-2024. Should this initial PK and safety data go well, then it opens the door to another catalyst thereafter in 2024, which would be the initiation of a phase 2 study using APG777 for the treatment of patients with AD. The potential with this biotech leads to the possibility of developing biologics with improved half-life compared to other already approved therapies. APG777 is an IL-13 inhibitor like lebrikizumab, but is being developed to potentially have an improved half-life compared to it. In essence, if Apogee’s drug can generate data that is equivalent/superior over lebrikizumab for AD and others, then it has potential to be transformational for these 1st-line patients. Lastly, should APG777 prove itself as an IL-13 inhibitor, it could ultimately be expanded upon to target other autoimmune disorders.
First Milestone Achieved With Potential For Others In 2024
Apogee Therapeutics dosed the first patient using APG777 in a phase 1 study in healthy volunteers. This double-blind placebo-controlled study is expected to enroll up to 40 healthy patients who are going to be separated into the following dosing cohorts:
- Three single-ascending dose cohorts
- Two multiple-ascending dose cohorts
The primary endpoint of this study is going to be safety of APG777, but the secondary endpoint is going to look at the pharmacokinetic [PK] profile of this drug in these healthy volunteers. There is a catalyst opportunity for investors to look forward to in mid-2024, which is the release of initial PK and safety data to be released then. PK data is important for a drug as it looks at several items such as absorption and metabolism of a drug in the body. The goal of this first in human phase 1 study is to see if APG777 is safe/tolerable for patient to take. Should data from the phase 1 study go well, then it opens the potential for Apogee to then move towards the next stage of development. This then leads to a catalyst, whereby this company will explore the use of this drug to treat patients with moderate-to-severe atopic dermatitis [AD] in 2024. The global atopic dermatitis market size is projected to reach $22.6 billion by 2031. This is a huge market opportunity, but if it hopes to compete, it will have to provide a significant competitive advantage.
The intention for Apogee Therapeutics is to improve the standard of care [SOC] for atopic dermatitis and other autoimmune disorders. The goal is to take established targets, such as IL-13 inhibition, and then improve upon half-life and other molecular properties. The use of IL-13 as a target against atopic dermatitis has been proven with the advancement of Eli Lilly’s (LLY) drug Lebrikizumab for the treatment of patients with AD. This drug has shown to be able have a significant effect in treating these patients. Not only that, but Eli Lilly was able to prove that once every 4-week dosing of lebrikizumab provided similar improvements to every 2-week dosing. The point here is that Apogee hopes to eventually overcome such dosing limitations. With the potential to have an improved half-life with APG777, it wants to possibly provide patients the option of receiving treatment less frequently to once every 3-months or once every 4-months. Thus, if it can ultimately provide a more convenient dosing option for them, it might be able to create a huge competitive advantage over these other companies targeting autoimmune disorders. That is, to have a drug that might be superior to first generation IL-13 antibodies, which are dosed every two to four weeks. Another potential competitor that Apogee may ultimately have to go up against might be Regeneron Pharmaceuticals (REGN) and Sanofi (SNY) with DUPIXENT. That’s because DUPIXENT has been approved for atopic dermatitis and several other autoimmune disorders. The thing about this drug is that it is a dual inhibitor of IL-13 and IL-4, while Apogee’s APG777 is only an IL-13 inhibitor. However, it remains to be seen if a significantly improved half-life and potency with APG777 may ultimately lead to superior efficacy in AD. Besides the fact, that it may also potentially offer a less frequent dosing option as well. Another possible indication it might decide to explore with APG777, should the phase 1 data warrant it, would be the targeting of patients with asthma. However, a phase 2 study for this program would not be initiated until 2025.
There is a lot of potential with this biotech, because it is not just looking to create less frequent dosing for its IL-13 APG777 drug. It is also eventually hoping to advance an IL-14 inhibitor drug, known as APG808, which it believes could be used to treat patients with chronic obstructive pulmonary disease [COPD]. It believes that it could also offer less frequent dosing with this anti-IL-4 antibody drug for the treatment of these patients. Another drug it has in its pipeline would be OX40L, which is being developed for AD and other autoimmune disorders.
Apogee Therapeutics is a biotech that just recently completed an IPO. It closed its initial public offering of 20,297,500 shares of common stock at a public offering price of $17 per share. Along, with the underwriters exercising their option to purchase up to an additional 2,647,500 additional shares at the very same price. The total gross proceeds that it has obtained through this offering was $345 million before deducting expenses. Shares of the biotech began trading on the NASDAQ Global Market on July 14th of 2023 with the ticker symbol of “APGE”. With the prior cash on hand of $141.3 million as of March 31, 2023, plus the addition of this additional cash through the IPO, it believes that it will have enough to fund its operations into the 2nd half of 2026.
Risks To Business
There are several risks that traders and investors should be aware of before investing in Apogee Therapeutics. The first risk to consider would be with respect to the development of APG777 for the treatment of patients with atopic dermatitis [AD]. It is expected that initial safety and PK data from the phase 1 study in healthy volunteers will be released in mid-2024. There is no assurance that this drug will either be safe or achieve the ability for having an improved half-life to provide less frequent dosing. A second risk to consider would be with the advancement of a phase 2 study using this drug for this treatment population. Even if a 16-week phase 2 study is initiated, there is no assurance that APG77 will be able to perform better than placebo. A third risk to consider would be with respect to competitors who either have a regulatory approved drug or who are close to receiving it. For instance, the goal is for the company to improve upon current first-generation targets such as IL-13. As I noted above, Eli Lily with Lebrikizumab and Regeneron/Sanofi with DUPIXENT are going to be major competitors. Thus, unless Apogee is ultimately able to differentiate itself with less frequent dosing, then even upon regulatory approval it may not do well in the market.
Apogee Therapeutics is a good speculative biotech play to look into. That’s because it has the ability to capture large target market indications, if it can ultimately achieve a specific outcome. That would be the ability to achieve an improved half-life using the IL-13 inhibitor drug APG777 for the treatment of patients with AD. If safety/efficacy of this drug is proven in AD, then it may also be possible to advance it towards other autoimmune disorders as well. Just looking at the atopic dermatitis indication alone, that would be a large enough market opportunity. It is said that the global atopic dermatitis market alone would reach $22.6 billion by 2031. Should things go well for the AD indication as trials go on, then it could branch out towards other large market indications.
For instance, it hopes to advance APG777 for asthma as well. Although, such a study for this indication is not planned to start until at least 2025. Lastly, it has several other drugs in preclinical development. For instance, APG808 is being advanced for the treatment of patients with chronic obstructive pulmonary disease [COPD], which is another large multi-billion-dollar market indication. With preliminary safety/PK data of APG777 from healthy volunteers expected in mid-2024, plus the potential to initiate a phase 2 study in 2024 thereafter in treating patients with AD, I believe that investors can benefit from any potential gains made here. Especially if the theory of being able to improve the half-life of already established targets can be achieved.
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