Celyad’s Phase III CHART-1 study in cardiac regeneration missed its primary endpoint, but a clinically defined subgroup with 60% of patients saw a positive outcome, p=0.015. Celyad management believes data are robust enough to discuss submitting a conditional marketing authorization to the EMA for European approval. Data on the CHART-1 composite endpoint will be presented on 28 August 2016. The US Chart-2 trial with a new endpoint and EDV focus will run if partnered. On the basis of limited data, the indicative value has been revised from $96.8 to $35.2 per share.
Pivotal cardiac primary missed, subgroup data good
The Phase III C-Cure CHART-1 cardiac regeneration trial did not show statistical significance on its primary endpoint. However, 60% of patients did respond well in a retrospectively defined subgroup characterized by a “mid-range” end diastolic volume (EDV): the volume of blood in the left ventricle just before the heart contracts. All CHART-1 patients had a 35% or less ejection fraction (this is normally around 66%); the EDV is likely to be high due to heart distention. The primary endpoint was a composite (Bartunek et al, 2015), but no details on the responses to the six different factors used will be released until 28 August.
Interpretations and what next?
Celyad management hopes to file a marketing authorization with the EMA. The EMA is often pragmatic if there is an unmet medical need (as in this case) and a safe therapy (proven) with adequate supportive data (claimed). Celyad aims to do an EU marketing deal based on EMA approval. The part-US 240-patient Phase III CHART-2 study, once adjusted to only recruit responsive EDV patients, will go ahead, using a new, although only once partnered. Edison has revised the potential US launch date to 2022 from H2 2020. Resources and cash will now be focused on NKR-T
Valuation: Revised from $97 to $35 per share
The probability for CHART-2 has been adjusted to 35%, previously 40%. No sales are forecast in the EU until the CHART-2 readout in 2021, then the European probability matches the US at 35%. Market sizes have been adjusted to include only the 60% of patients with appropriate EDV values. Possible EU upfront fees and milestones payments have been reduced. This takes the indicative value to $35 per share. We forecast cash to be about $17-22m by late 2017, depending on NKR-T investment and progress. This suggests further funding depending on deal payments received. Our 2016-17 financial forecasts do not assume any C-Cure deals. CAR cancer will be reassessed when Phase I/II completes.