NKTR thoughts

NKTR presented additional clinical data. I watched the presentation which is highly technical with many medical terms and acronyms. I understand a lot or most of it, and I think I get the overall message.

I continue to be vey excited with the NKTR-214 results. They are getting a great complete response with the therapy. Trials are advancing and last week we heard that Pfizer is jumping on the NKTR-214 bandwagon with several combination trial. It was announced that Pfizer will be paying for a least one of the trials. Why would Pfizer do these trials and why would Pfizer pay for at last one of the trials as opposed to an agreement that the companies share the cost? I believe the reason is that companies believe that their drug can have a better clinical benefit when combined with NKTR-214. They are seeing the results of the NKTR-214 trials with BMS and you have better clinical outcomes and very low toxicity. So I see that NKTR has leverage because adding 214 can potential help many other drugs with better efficacy. We are seeing this in how the partnerships are being strutted and these deal structures support the notion that NKTR-214 can be a backbone therapy for IO in many oncology diseases. The clinical trials continue to show good enough results to proceed with many phase 3 clinical trials. It was also presented that one Phase 3 trial will be completed by Q3 2020 so I think we are looking at FDA approval for NKTR-214 beginning in 2021.

The first data for NKTR-262 combo with NKTR-214 was shown. Only 7 patients have been dosed so far so results are early. As we know with NKTR-214’s treatment the clinical results improve with time. However, there were 2 case studies presented that look VERY promising. These were metastatic melanoma patients who has disease progression with prior treatment regimens. The NKTR-262/NKTR-214 combo in these 2 patients showed tumor reduction…very evident on the radiology scans. These patients are an the way to dying from their disease and the 262/214 treatments is showing that the tumors are shrinking! I am very excited about the 262/214 data and prospects.

It’s very clear that the NKTR-214 studies are showing that many patients have a complete response (cancer gone) and many on the treatment have stable disease with the treatment. This bodes very well for FDA approval and first line therapy/standard of care.

262/214 offers a potential cure for many cancer types.

For me, the clinical results support my thesis that NKTR will transform cancer treatment in not one form of cancer but many. It supports that many companies will partner to combine 214 with their drugs. NKTR’s drugs are working, easy to manufacture, produce hardly any serious side effects. We had companies like KITE and JUNO acquired for around $12B. NKTR is WAY better than those companies. NKTR’s market cap is less than half of those of JUNO and KITE are their acquisition prices. I think at a minimum (floor) NKTR should be worth $12B which is a per-share price of about $80.

NKTR is my smallest position at 2.7% of my portfolio. I added shares this past week and I may add a little more to get the position up to 3%. Part of my position is in the form of leaps. I recently rolled my leaps forward from Jan 2020 to Jan 2021. If we expect completion of the first phase 3 trials in Q3 2020 then we should get the results before January 2021. I already think that the chance of FDA approval for 214 is >90%; the phase 3 trials, if they turn out as I expect, should make NKTR a buyout target at well over $80 per share. However, I think that there’s a high chance that NKTR will remain a stand-alone company and may well become a big biotech. I know that many, including Saul, has lost patience in NKTR. Yes, Saul has certainly done better with his dollars that he pulled out of NKTR and redeployed into other companies that have grown. I still like NKTR because the clinical results keep pointed to progress and a potential cure for many oncology diseases with many other patients getting the clinical benefit of stable disease (life being prolonged with minimal side effects (unlike chemotherapy) from the drugs.



A question: if you had cancer, say stage 4 melanoma, and your oncologist told you that there is a treatment with minimal side effects (as opposed to the chemotherapy treatment option) and has, in other patients, shown a 25% chance of a COMPLETE RESPONSE (i.e. no more detectable cancer) what would you do? Also, if the oncologist told you that at least 50% of the patients on the treatment have PROGRESSION-FREE DISESE (i.e. cancer remains stable and doesn’t get worse). Would this be a difficult choice?



I went back and listened to the con call with the slides last night. Nktr does seem to have a lot of promise with its 214/262 combination, it also just signed collaboration with pfe, still has the pain killer drug, pivot-02 has higher complete response than BMy is showing in their checkmate trials (while showing similar overall response). I am considering selling only part of it or none at all although I was disappointed with the results for pivot 02. It becomes more questionable for me that they will bring successful products to market within the next few years while twlo and NVDA are generating huge growth and also have big opportunities.


I caution you against looking too deeply into small trials.
This particular trial is 40 patients designed for tolerability and safety, and while those are important, having a primary endpoint such as Progression free survival is, in general, reserved for later stage (and larger) trials.

To ask if someone with stage 4 melanoma would be willing to take a chance of 25% is a quite an oversimplification. It does not acknowledge that this study was not powered for efficacy. Plus there’s the 20% grade 3/4 treatment adverse events with 5% dropping out And 7.5% requiring dose adjustments. (All slightly higher than previously seen with opdivo/214 combo).

214 remains a relative unknown until some of these larger phase 3 trials come out. Really depends on how much you want to be in at the ground floor and say “I had it when!” vs waiting a bit for their data to come out and potentially losing out on some gains (and/or stomach ulcers).


Oh, and I also recommend taking biotech timelines with a grain of salt,cespecially if it’s more than 6-12 months. Amazing how “ETA 2020” becomes “early 2022”, etc.


Would this be a difficult choice?

Depends what they charge and how much money (or insurance) I have. Some of these are crazy expensive because lives are valuable.