COVID-19 Therapeutics: The Leading Contenders – Seeking Alpha

The need for medicines that help Covid-19 patients before the disease leaves the viral response phase and enters the host inflammatory phase has never been greater. While there are some positive signals in the prevention area, the most frequent estimates I am reading place a realistic timeline on the development of a vaccine of at least a year to eighteen months, and then global production capacity will need to ramp up.

There are two broad categories in the fight to treat Covid-19: 1) vaccines, 2) therapeutics.

There are at last count some 70 vaccine candidates in development. Some early promising signs have emerged from these groups of scientists, though we have also heard discouraging information, expressed even before this pandemic, that some viruses are notoriously difficult to vaccinate against, despite decades of work and billions of dollars. Even when a vaccine is developed, the complexities of production, distribution, and effectiveness present themselves. How long will the vaccine confer protection, and will mutations render it ineffective? How will we vaccinate enough of the 7.6 billion people on the planet to confer herd immunity? Assuming a vaccine that is effective, what about those who will invariably become infected nonetheless, either since they did not get vaccinated or since the vaccine isnt a 100% sure thing? After all, the flu vaccine is only 40% to 60% effective, according to the CDC.

There is an immediate need for therapeutics for Covid-19, and even after an effective vaccine is developed (and count me in the optimistic camp), there will be a huge continuing need for therapeutics.

[Source: The Journal of Heart and Lung Transplantation]

It is now generally recognized that the major cause of injury and death from Covid-19 is a condition called the cytokine storm [other research here, here and here]. I first learned about the cytokine storm about ten years ago from my research into a company named Cytosorbents (CTSO), which receives an honorable mention in my list of therapeutics contenders below.

Physicians Weekly describes the cytokine storm and its relationship to viruses like Covid-19 as follows:

A cytokine storm is an overproduction of immune cells and their activating compoundscytokineswhich, in something like a flu infection, is often associated with a surge of activated immune cells into the lungs. The resulting lung inflammation and fluid buildup can lead to respiratory distress and can be contaminated by a secondary bacterial pneumonia. This increases the risk of mortality in patientsCytokine storm is now seen as a likely major cause of mortality in the 1918-20 Spanish fluwhich killed more than 50 million people worldwide and the H1N1 swine flu and H5N1 bird flu of recent yearsand now COVID-19. [Source: Cytokine Storm: The Sudden Crash in Patients with COVID-19]

A number of public companies are currently testing their therapeutics for the ability to reduce the cytokine storm and thereby reduce mortality in Covid-19 patients. It is at the point when Covid-19 shifts from a viral disease to an immunological disease that the risk of death greatly increases, and I believe the below companies (in no particular order) have the best chance of producing an effective therapeutic.

Im going to give a brief description of each company and my understanding of its therapeutic candidate, followed by my reasons for owning the stock. Biotech investing is always tricky, where what works conceptually or in the lab might not work in a double-blind placebo controlled trial, and risk is compounded when multiple companies are racing to treat the same indication. For this reason, and because I have no secret insight into the method of action of these therapeutics, I own stock in each of these companies - a basket of therapeutics. I believe each of the companies that Ive selected as contenders has a compelling rationale and potential utility in multiple indications, which theoretically will reduce the investment risk of owning just one therapeutic in the event of failure to meet efficacy endpoints in Covid-19 trials.

Humanigen has a monoclonal antibody in trials for Covid-19. Humanigens drug is named Lenzilumab, and Lenzilumabs target is the Granulocyte macrophage - colony stimulating factor (GM-CSF).

According to Humanigen, Lenzilumab neutralizes GM-CSF, an upstream mediator of numerous inflammatory cytokines (or monokines as the case may be), such as MCP1, MIP1a, IL1b, IL6, TNFa, VEGF and IP10.

Humanigen states that many drugs that target an IL-6 blockade reduce only IL-6 and do not block inflammatory myeloid cells activation or downstream monokine production and that the IL-6 blockade alone has not shown clinical utility as a preventative measure in CAR-T induced cytokine stormmonokines such as MCP-1, MIP1a, MIG, IP10, IL-1 are important in the inflammatory cascade and only blocked with GM-CSF neutralization. [source: Humanigen Corporate Presentation]

[source: Humanigen Corporate Presentation]

On May 6, 2020, Humanigen announced that the first patient was dosed with Lenzilumab in a 238-participant Phase 3 Randomized, Placebo-Controlled Study of Lenzilumab in Hospitalized Patients With COVID-19 Pneumonia. The trial is recruiting at 8 sites so far as of May 27, including prestigious sites such as the Mayo Clinic (Phoenix, Arizona, Jacksonville, Florida, and Rochester, Minnesota branches), Emory University in Atlanta, and Dartmouth-Hitchcock in New Hampshire. Stanford University is also listed as a trial site.

In a press release announcing the initiation of this trial, Humanigens CEO Dr. Cameron Durrant stated, As the only company that has been working on prevention of cytokine storm through GM-CSF neutralization for nearly three years, we have published extensively in this field and filed extensive IP. We plan to bring this experience to the COVID-19 setting and recruit patients into this Phase III study as quickly as possible."

Humanigen also just announced on June 2 a raise of $72 million, with JPMorgan (JPM) acting as the placement agent, and investors in the raise include such biotech investment luminaries as Venrock Healthcare Capital Partners, Surveyor Capital, HealthCor, Valiant Capital Partners, First Light Asset Management and Ghost Tree Capital.

The CEO also stated that Humanigen plans to uplist onto a national securities exchange in the coming months.

A bit of history here: Humanigen was previously Nasdaq-listed, known as KaloBios (KBIO) and in 2015 planned to wind down operations for lack of funding. However, biotech investor, hedge fund manager, and now notorious target of worldwide scorn Martin Shkreli swooped in with an investor group and bought a controlling stake in the company. At the end of 2015, KaloBios appointed Shkreli as chairman of the board and elected him CEO. After only about a month, Shkreli was terminated as Chief Executive Officer of the Company and resigned the chairmanship. Owing to Shkrelis arrest and indictment, Nasdaq elected to delist KaloBios. After a Chapter 11 bankruptcy reorganization of the company and its emergence, the hiring of new management with no association with Shkreli, and the announcement that Shkreli sold his remaining stake in the companys stock, the companys fortunes have greatly improved. (For a guy with no official medical training and more than a few flaws, Shkreli does/did seem to have a good eye for promising drug candidates).

What I like about Humanigen:

HGEN

Market Cap:

Like Humanigen, CytoDyn also has a monoclonal antibody. CytoDyns is named Leronlimab, which also acts as an upstream modulator of numerous cytokines, among other therapeutic effects.

CytoDyn has recently applied for a BLA for Leronlimab, for use by HIV patients in combination. More recently, the company filed a request for expedited decision from the FDA. Leronlimab met its end points in a pivotal trial of patients with CCR5-tropic HIV-1 infection and documented genotypic or phenotypic resistance to HAART drugs within three drug classes or within two or more drug classes with limited treatment options.

Dr. Bruce K. Patterson, an advisor to CytoDyn and CEO of clinical lab IncellDx, analyzed the blood levels of numerous cytokines and other markers of 10 critically ill Covid-19 patients who were given Leronlimab under the FDAs Emergency Investigational New Drug (EIND) program, both before and after dosing, and determined that the CCR5 receptor binding and occupancy ability of Leronlimab appears to significantly reverse the course of the disease in the cases that were studied. Leronlimab appears to 1) reduce the cytokine storm, 2) modulate the bodys immune system to restore its effectiveness, and 3) reduce the viral load of Covid-19. Here is a study on which Dr. Patterson was corresponding author, entitled Disruption of the CCL5/RANTES-CCR5 Pathway Restores Immune Homeostasis and Reduces Plasma Viral Load in Critical COVID-1, authored with co-senior authors Lishomwa C. Ndhlovu, M.D., Ph.D. and Jonah B. Sacha, Ph.D.

Some key excerpts from this papers abstract:

Following compassionate care treatment with the CCR5 blocking antibody leronlimab, we observed complete CCR5 receptor occupancy on macrophage and T cells, rapid reduction of plasma IL-6, restoration of the CD4/CD8 ratio, and a significant decrease in SARS-CoV-2 plasma viremia. Consistent with reduction of plasma IL-6, single-cell RNA-sequencing revealed declines in transcriptomic myeloid cell clusters expressing IL-6 and interferon-related genes. These results demonstrate a novel approach to resolving unchecked inflammation, restoring immunologic deficiencies, and reducing SARS-CoV-2 plasma viral load via disruption of the CCL5-CCR5 axis, and support randomized clinical trials to assess clinical efficacy of leronlimab-mediated inhibition of CCR5 for COVID-19.

The chemokine CCL5, also known as RANTES, being blocked from attaching to the CCR5 receptor by the presence of Leronlimab, is unable to summon more inflammatory cytokines when triggered by Covid-19, resulting in a reduction of inflammation and a possible reversal of the cytokine storm. According to Dr. Patterson's study,

Recent studies have found that a significant number of COVID-19 patients experience increased risks of strokes, blood clots and other thromboembolic events. Platelet activation, which leads to the initiation of the coagulation cascade, can be triggered by chemokines including CCL5 suggesting that leronlimab treatment may be beneficial beyond its immunomodulatory effects on inflammation and hemostasis in COVID-19 patients.

[Source: Pre-Print Study Disruption of the CCL5/RANTES-CCR5 Pathway Restores Immune Homeostasis and Reduces Plasma Viral Load in Critical COVID-1]

CytoDyn is currently enrolling patients in two blinded placebo controlled clinical trials, one Phase 2 75 patient trial in mild/moderate patients and one Phase 2b/3 390 patient trial in severe patients. The CEO said that as of June 2, 2020, the mild/moderate trial has 58 patients enrolled and they intend to unblind the trial on June 15 and hopefully reveal results by the end of June. The severe trial currently has 51 patients enrolled, and on June 15 the CEO said they also plan to do an interim look at the first 50 patients, which is built into the trial.

CytoDyn has given Leronlimab to 75 patients through the EIND protocol, and has reported many successful outcomes, though they point out that only controlled trials will confirm patient recoveries are due to the drugs efficacy.

CytoDyn is also conducting a breast cancer trial and a basket trial for the use of Leronlimab in various cancers. CytoDyn believes the unique CCR5 receptor occupancy method of action of Leronlimab is applicable to a wide variety of diseases.

CytoDyn is currently listed over-the-counter, though the CEO has stated as recently as June 2 that their plan is to uplist to a national securities exchange soon. I believe the company is currently extremely undercapitalized for all of their planned trials and indications, and will need to raise money in the very near term. CytoDyns stock price has risen dramatically along with the positive information about Leronlimab that has reached the public. Along with the extremely compelling results achieved by Leronlimab through the EIND process in Covid-19 patients and stories of lives saved, there are those who have criticized the CEO, Nader Pourhassan, Ph.D., for his statements about Leronlimab that some view as overly promotional (as well as what some consider rambling conference calls, and imprecise timelines.) Despite this, on the positive side, the CEOs philosophy appears to be: the more communication with the shareholder base, the better. The CEO has been with the company in various capacities since 2008, and you might love him or hate him. My take is to listen to the data and let it speak. I also was very impressed with interviews here and here, with Dr. Otto Yang, an HIV researcher at my alma mater U.C.L.A., who has been involved with EIND use of Leronlimab and the clinical trials of Leronlimab at U.C.L.A.

What I like about CytoDyn:

Clinical Trials:

Phase 2 Mild/Moderate 58 patients enrolled so far. 75 participants total.

Phase 2/3 Severe 51 patients enrolled so far. 390 participants total.

Chimerix owns the rights to a drug named dociparstat sodium, also known as DSTAT.

Chimerix describes DSTAT as

a glycosaminoglycan derivative of heparin with known anti-inflammatory properties, but with substantially reduced risk of bleeding complications compared to commercially available forms of heparin. DSTAT is currently in development as a first-line therapy in acute myeloid leukemia (AML). The scientific literature and recent clinical studies suggest that adding DSTAT to standard chemotherapy for AML may improve patient outcomes. [source: Chimerix Website]

Based on DSTATs target and method of action, Chimerix decided to rapidly initiate clinical trials for use in acute lung injury (ALI) in COVID-19 patients.

The company describes DSTATs compelling method of action in ALI as follows:

DSTAT has the potential to inhibit the hyperactive immune response and resulting inflammation, as well as address the underlying causes of coagulation disorders seen in COVID-19 patients, but with substantially reduced risk of bleeding complications compared to commercially available forms of heparin. Chimerix states that they anti-inflammatory effect of DSTAT occurs via the inhibition of high mobility group box 1 (HMGB1) activity. Inhibition of HMGB1 activity reduces expression of downstream proinflammatory cytokines including, but not limited to, IL-6, tumor necrosis factor- (TNF-), monocyte chemoattractant protein-1 (MCP-1) and macrophage inflammatory protein-1 (MIP-1), all of which are implicated in the overactive immune response seen in COVID-19. [source: Chimerix Website]

[source: Chimerix website]

DSTAT further could assist Covid-19 patients through reduction of hypercoagulation. Weve read about Covid-19 patients succumbing to strokes, as a result of blood clots.

Chimerix states that

Neutrophils are early responders to infection capable of extruding granular and nuclear contents to produce neutrophil extracellular traps (NETS). NETs may be beneficial (e.g., by trapping pathogens); however, excessive NETs can be pathogenic, particularly in the lungs where damage to the thin layer of cells in the alveoli can result in decreased oxygenation. HMGB1 promotes NETs which may drive hypercoagulation by providing a substrate for platelet aggregation and by upregulating tissue factors on endothelial cells. Activated platelets, in turn, release PF4, which further increases inflammation, creating a detrimental cycle. DSTATs inhibition of two key inflammatory drivers of this process (PF4 and HMGB1) may prevent and treat coagulation disorders observed in COVID-19 patients. [source: Chimerix Website]

Chimerix is currently conducting a clinical trial, summarized as A randomized, double-blind, placebo-controlled Phase 2/3 study to evaluate the safety and efficacy of DSTAT in patients with Acute Lung Injury (ALI) due to COVID-19. The trial aims to enroll 524 participants.

As of May 15, when the clinical trial was posted to clinicaltrials.gov, it had not yet begun recruiting, though in its May 7 earnings release, Chimerix stated its intention to have the trial up and running by the end of May, and to have the Phase 2 safety portion of the trial available before the end of the year.

I reached out to Chimerix to see if the company had also received EIND approval to treat Covid-19 patients with DSTAT, but I have not yet heard back.

What I like about Chimerix:

Clinical Trials:

Phase 2/3 / expected to have begun recruiting by end of May / 524 participants total

Mesoblast describes its technology as follows:

Mesoblasts proprietary mesenchymal lineage adult stem cells (MLCs) are found in multiple tissues where they play vital roles in maintaining tissue health. They are rare cells found around blood vessels that respond to signals associated with tissue damage; secreting mediators and growth factors which promote tissue repair and modulate immune responses.

For its Covid-19 treatments, Mesoblast is using Mesenchymal Stem Cells (MSCS) derived from its proprietary line. They are bone marrow derived and allogeneic.

Mesoblast gave its Remestemcel-L stem-cell infusions to 12 patients with moderate to severe Acute Respiratory Distress Syndrome (ARDS) in New York under the FDAs emergency compassionate use protocol, and the results were very impressive. Mesoblast reported that 9 of the 12 ventilator-dependent patients at Mt. Sinai were able to come off of the ventilators within a median of 10 days and were discharged from the hospital.

The company press release stated that the survival rate of these patients was 83%, versus only 12% survival of ventilator-dependent patients at two major hospitals in New York during the same March to April 2020 period in New York.

Mesoblasts 300 participant clinical trial in patients with moderate to severe ARDS from COVID-19 was announced on April 8, will enroll in up to 30 sites across North America, with planned interim analyses that may result in stopping the trial early for efficacy or futility.

The United States Food and Drug Administration (FDA) has accepted for priority review the Mesoblasts Biologics License Application (BLA) to seek approval of remestemcel-L for steroid-refractory acute graft versus host disease (SR-aGVHD) in children. The FDA set a Prescription Drug User Fee Act (PDUFA) action date of September 30, 2020.

In addition to ARDS caused by Covid-19, Mesoblast is also testing remestemcel-L in graft vs. host disease, heart failure and chronic low back pain.

What I like about Mesoblast:

Clinical Trials:

Phase 3 / recruiting / 300 participants / First dosing May 6

Athersys is a leading developer of stem-cell based therapies, and their stem cell products are currently in advanced testing in the following indications: Covid-19 induced ARDS, Ischemic Stroke, Acute Myocardial Infarction, and HSC Transplant/GvHD.

Athersys unique value proposition is that their stem cell products, named MultiStem, are developed from stem cells called Multipotent Adult Progenitor Cells (which theyve trademarked as MAPC). These cells are distinct from mesenchymal stem cells. They acquire the cells initially from healthy adult bone marrow, and Athersys claims a proprietary method to culture and expand their stem cells that allows them to produce vastly more stem cell product on an industrial scale with ease and repeatability.

[source: Athersys Corporate Presentation]

Athersys announced their pivotal Phase 2/3 clinical trial of MultiStem in Covid-19 induced ARDS on April 13, 2020, and commenced patient enrollment on May 5. The study is designed to enroll approximately 400 subjects and will be conducted at leading pulmonary critical care centers throughout the United States.

What I like about Athersys:

Clinical Trials:

Phase 2/3 / recruiting / 400 participants / First enrollment May 5

Cytosorbents produces the cytosorb filter, a cartridge filled with adsorbent beads, and when placed in-line with a dialysis machine or hemoperfusion pump among other methods, can extract large quantities of inflammatory cytokines from the bloodstream of a patient to reduce the cytokine storm.

Cytosorb describes its filter as follows:

A CytoSorb cartridge is filled with CytoSorbents proprietary hemocompatible, porous polymer beads that are roughly the size of grains of salt. The dimensions of the pores in each bead are specifically designed so that large objects such as blood cells go around the bead while small objects like electrolytes pass through it. However, appropriately sized substances are captured and trapped inside the beads pores and channels via pore capture and surface adsorption and are permanently eliminated from blood. In particular, hydrophobic substances are preferentially adsorbed to the hydrophobic polymer beads. CytoSorb has been optimized to broadly remove many cytokines, toxins and other inflammatory mediators in the cytokine sweet spot, a 5-60 kDa molecular weight range where most cytokines reside. [Source:Cytosorbents Website]

[Source: Cytosorbents Press Kit]

The Cytosorb filter is also being used to extract drugs like blood thinners from a patients blood prior to heart surgery. Other potential uses include immunomodulation during CAR-T therapy, as CAR-T therapy has been well documented to sometimes cause cytokine release syndrome (CRS).

The Cytosorb filter is approved in Europe to treat the runaway inflammation of the cytokine storm, as a prophylaxis of said cytokine storm during open heart surgery, and to extract bilirubin in liver disease, and myoglobin in trauma.

On March 25, Dr. Phillip Chan, MD, Ph.D., the CEO of Cytosorbents, provided an update on the use of the Cytosorb filter to help patients with Covid-19. He stated,

CytoSorb has now been used in more than 70 COVID-19 patients to help treat cytokine storm and life-threatening complications such as acute respiratory distress syndrome (ARDS) and shock in Italy, China, Germany, and France. Due to the crisis, the ability to obtain patient level data has been very limited. However, based upon initial, preliminary verbal reports from physicians treating these complications, CytoSorb use has generally been associated with a marked reduction in cytokine storm and inflammation, improved lung function, weaning from mechanical ventilation, and a reversal of shock.

While Cytosorbents has had a long relationship with DARPA, the U.S. Army, the U.S. Department of Health and Human Services, and the National Institutes of Health (NIH), the Cytosorb filter has not yet received FDA approval for use in the United States, other than recent FDA Emergency Use Authorization in the United States for use in adult, critically-ill COVID-19 patients with imminent or confirmed respiratory failure.

The company sent out the following report to those on its email list in which a Milwaukee doctor talks about how the Cytosorb filter helped three of his critical Covid-19 patients: Could this blood filter not yet FDA approved save COVID-19 patients?.

I do not own stock in Cytosorbents currently, though I think their filter is useful and effective in many indications. Since they do not have an active FDA approved clinical trial in the works for Covid-19, I believe that other companies stand a good chance of being earlier to market with effective therapeutics for Covid-19.

Clinical Trials:

Not yet

Covid-19 Virus showing the "spike proteins" [image source: U.S. Centers for Disease Control]

The world needs an effective treatment for Covid-19, which has devastated economies and caused misery across the world. I decided to research the causes of the worst outcomes from Covid-19 infection, and locate the companies that I believe have the best chance of providing therapeutics to help mitigate the terrible effect this virus has wrought.

While I believe a vaccine will come, it may not be as soon as we hope (of course we hope we could have had it yesterday), and we are going to need therapeutics that ameliorate the cytokine storm and coagulation irregularities in the immediate term and even after a vaccine is developed. I think an effective therapeutic could potentially turn Covid-19 from an extremely dangerous virus into another bad flu, since symptomatic people, treated in time with a therapeutic that stops the cytokine storm, could escape the devastation of the bodys inflammatory cascade.

This article is my attempt to consolidate a couple months of research and selection of what I believe are viable therapeutics. I hope this research both inspires readers to do deeper research into the companies which I have highlighted, and generates active commentary where readers can suggest other Covid-19 therapeutics that they believe should be in any investors Covid-19 therapeutics basket.

Those familiar with my work know that normally I write single-stock research articles. In the case of Covid-19 therapeutics, Ive taken the multi-stock basket approach because I think it is the best way to deal with the inherent uncertainties involved in biotech. The only bright side that I can see from this pandemic (remember, Im an optimist) is that Covid-19 is calling attention to the cytokine storm, and companies around the world are throwing everything they have into researching treatments, which is accelerating human trials in an unprecedented way. If scientists can develop therapeutics to effectively settle our own immune systems down before they get out of control, we might find that this is a key to fighting not only Covid-19, but also many other intractable diseases.

Disclosure: I am/we are long ATHX, CMRX, CYDY, HGEN, MESO. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: I am not registered as an investment advisor in the United States or in any other jurisdiction. Information in this article is presented as is, without warranty of any kind whether express or implied. I make no representation, express or implied, as to the accuracy, timeliness, or completeness of any such information or with regard to the results to be obtained from its use. All expressions of opinion are subject to change without notice, and I do not undertake to update or supplement this report or any of the information contained herein.

This is not an offer to sell or a solicitation of an offer to buy any security, nor shall any security be offered or sold to any person, in any jurisdiction in which such offer would be unlawful under the securities laws of such jurisdiction.

I have not received any form of compensation from the companies that I have written about in this article, nor have I received any form of compensation from company affiliates or other company shareholders.

Originally posted here:

COVID-19 Therapeutics: The Leading Contenders - Seeking Alpha