Nkarta, Inc. (NASDAQ:NKTX) is gearing up to report results from its phase 1 study, using NKX019 for the treatment of patients with relapsed/refractory non-Hodgkin’s lymphoma [NHL]. Such data is going to be released by mid-2024 and will determine if this biotech is going to continue to advance the use of this particular natural killer [NK] cell therapy to target this r/r patient population. This is crucial because the company went away from original dosing and transitioned to compressed dosing of these patients. It was stated that continued advancement of NKX019 for this r/r NHL patient population will only be moved forward with positive data. Hopefully, the data will turn out to be good and this program can move forward.
A good thing about Nkarta is that it is also advancing its allogeneic NK cell to treat patients with autoimmune disorders as well. Matter of fact, it is advancing a phase 1 study using NKX019 for the treatment of patients with lupus nephritis [LN]. The first patient is expected to be dosed any day now in the 1st half of 2024. Not only that, but the company is in the process of testing out this therapy for the use against other autoimmune disorders. Lastly, this biotech should now be funded for an extended period of time, because it just enacted a cash raise. That is, it just announced a $240 million underwritten offering, which is expected to close on March 27th, 2024.
NKX019 For The Treatment Of Patients With Non-Hodgkin’s Lymphoma
As I stated above, NKX019 is being advanced for the treatment of patients with relapsed/refractory non-Hodgkin’s lymphoma in the ongoing phase 1 study. Non-Hodgkin’s lymphoma [NHL] is characterized as cancer of the lymphatic system. What occurs is that white blood cells, which are key to a patient’s immune system, grow abnormally out of control. Such abnormal growth leads to solid tumor formation and can lead to a host of many other problems. Some symptoms that these patients with NHL experience are as follows:
- Abdominal pain.
- Fatigue that persists.
- Weight loss.
- Swollen lymph nodes.
- Unexplained weight loss.
- Fever being present.
The global non-Hodgkin’s Lymphoma market is expected to reach $20 billion by the end of 2036. This is a pretty large market opportunity, but there is something very important to consider here, which is that Nkarta is going after a specific patient population. How so? Well, the thing is that it is looking at initially using NKX019 for the treatment of patients with relapsed/refractory NHL. Consider that the most prevalent type of NHL is Diffuse Large B-Cell Lymphoma [DLBCL]. It is said that approximately 30% to 40% of DLBCL patients will have refractory disease. Thus, even if only having a focus on going after relapsed/refractory disease, it would still be able to target a good portion of this market opportunity.
The phase 1 study, using NKKX019 for the treatment of patients with r/r NHL, was designed in a different manner originally. What does this mean? Well, the thing is that the way the trial was first designed was to use lymphodepletion of fludarabine/cyclophosphamide, to be followed by 3 weekly doses of NKX019 on days 0, 7, 14 of a 28-day specific cycle. This proved to be pretty good, whereby initial data released showed some pretty good findings. This would be with respect to preliminary data released back in June of 2023. Such data, with a cut-off date of November 2022, showed that there was a 70% complete response rate achieved when r/r NHL patients took the highest dose of NKX019. In essence, 7 out of 10 patients responded to this NK cell therapy in the phase 1 study. As you can see, this is not bad evidence of proof-of-concept at all, but there is a way that better persistence and efficacy could be achieved. How so? This would be with respect to the altering of the trial design, where patients would be dosed with NKX019 at an earlier period of time following lymphodepletion. This is known as compressed dosing and could be something that might improve clinical outcomes. By dosing this NK cell therapy closer to lymphodepletion of fludarabine and cyclophosphamide [cy], it is believed that stronger persistence can be achieved. This remains to be seen, but investors won’t have to wait too long to see if this can be achieved. That’s because Nkarta expects to release preliminary data from this compressed cohort of this phase 1 study in mid-2024. The new dosing schedule to be used is going to have a total of 6 r/r NHL patients receive doses of NKX019 on Days 0, 3 and 7 following fludarabine [flu] and cyclophosphamide [cy] lymphodepletion.
Financials
According to the 10-K SEC Filing, Nkarta had cash, cash equivalents and investments of $250.9 million as of December 31st, 2023. It believed that this cash on hand would be enough to fund its operations into 2026. Despite this cash runway, management still chose to enact a fund-raising activity. That is, it priced a $240 million public offering today March 25th of 2024. It is going to use this cash to advance NKX019 for the treatment of patients with r/r NHL and also the other ongoing program, which is to use this same NK cell therapy to treat patients with autoimmune disorders. Not only did it likely raise to be able to advance both of these programs forward, but it also stated that it intends to use this cash for the continued buildout of internal manufacturing capabilities.
Risks To Business
There are several risks that investors should be aware of before investing in Nkarta. The first risk to consider would be with respect to the continued advancement of allogeneic NK cell NKX019 for the treatment of patients with r/r NHL in the ongoing phase 1 study. As I stated above, there was an improved compressed dosing trial design deployed for this early-stage study. In essence, the goal was to dose NKX019 closer to lymphodepletion. There is no assurance that such a dosing change will result in improved clinical outcomes for these patients.
A second risk to consider would be the advancement of NKX019 for the treatment of patients with Lupus Nephritis [LN]. Even though preliminary evidence has shown this therapy to work well in treating patients with r/r NHL, there is no guarantee that it will also do well in treating this specific patient population. Plus, there is an ongoing investigation to attempt to use it towards the targeting of other autoimmune disorders and it is not known whether or not NKX019 will succeed in any of these other disorders.
The third and final risk would be with respect to NKX101, which was being developed for the treatment of patients with relapsed/refractory acute myeloid leukemia [r/r AML]. The goal was to continue to advance this program based on the initial responses achieved from the first 6 patients of the phase 1 study. However, subsequent patients showed lower clinical response than was anticipated. To move this program forward, Nkarta believes that it will need to evaluate a way to optimize a different design for a future study. Maybe for instance, change the dosing schedule to improve clinical odds. For now, this program is on the back burner and there is no assurance that it will be revived later on. In addition, another item to consider would be that a clinical data update for this program will still be released at an upcoming medical meeting in the 1st half of 2024. There is no assurance that this data will be positive and could possibly result in the stock price of this biotech trading lower.
Conclusion
The final conclusion is that Nkarta has two shots on goal for continued advancement of its lead product NKX019, which is being advanced for the treatment of patients with relapsed/refractory non-Hodgkin’s Lymphoma [NHL] and autoimmune disorders like Lupus Nephritis [LN]. The release of data from the phase 1 study using NKX019 for the treatment of patients with r/r NHL is going to be critical, because it will signify if adjusting dosing of NK cell therapy closer to lymphodepletion will result in improved response rates for these patients. If this is shown here with respect to the advancement of this cancer target, using NK cell therapy, then it is possible that such a dosing change might also be applied to the targeting of r/r AML patients as well.
If for some instance, the use of NKX019 doesn’t work out well for the treatment of patients with cancer, at least it has other shots on goal in targeting patients with autoimmune disorders. The downside is the first LN patient to be dosed in the phase 1 study has not yet happened. This is expected in the 1st half of 2024 and from there, it could be a while before preliminary data is released from this program. With upcoming data from the phase 1 study using NKX019 for the treatment of patients with r/r NHL, plus another shot on goal in targeting the large autoimmune disorder market, I believe that investors can benefit from any potential gains made.
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