PDS Biotechnology Corporation (NASDAQ:PDSB) has been able to make great progress with respect to advancing the use of its lead candidate known as PDS0101, which is being developed in combination with Merck’s (MRK) Keytruda to treat certain patients with HPV16-positive head and neck cancer. The last time I spoke about this biotech it had not yet released interim data from this phase 2 study, nor talked about surpassing the efficacy threshold either. A key thing to note about the interim analysis was that 9 confirmed responses was achieved with 34 evaluable patients. Not only that, but a new update thereafter noted that the number of confirmed responses increased to 14. Thus, the efficacy threshold for Part 2 of this study was achieved. With that said, the plan is for PDS to submit an amended Investigational New Drug [IND] application to the FDA in Q3 of 2023, as it prepares to initiate its phase 3 VERSATILE-003 study.
Versatile-002 Study Continues To Build Momentum With Newly Updated Data
One key thing to note is that PDS Biotechnology continues to build evidence that its drug PDS0101 given in combination with Keytruda in adults with HPV16-positive unresectable, recurrent or metastatic head and neck squamous cell carcinoma [HNSCC]. This is with respect to released data, from the VERSATILE-002 study, as part of an ASCO poster presentation. The focus of the presentation for this interim analysis is based upon HNSCC patients who are immune checkpoint inhibitor [ICI] therapy naive. That is, patients who have not been previously treated with ICI therapy before entering this clinical study. The interim data noted that the 12-month overall survival [OS] rate was 87.1% and the median progression-free survival [PFS] rate was 10.4 months. A disease control rate [DCR] of 70.6% [24 out of 34 patients] was noted as well. At this time, the number of confirmed responses was 9 out of 34 [26.5%]. However, in June of 2023, this number changed, as at this time it was stated that 14 patients had a confirmed objective response.
Not only was this a good clinical update because the number of confirmed objective response had increased, but also for the fact that efficacy threshold was achieved. Again, this was in the HPV16-positive unresectable, recurrent or metastatic HNSCC patient population. The threshold for efficacy, was obtained when 14 out of the 54 ICI naive patients enrolled achieved a confirmed objective response. The reason why I feel that this newly updated data was important to highlight is because the efficacy threshold was reached, when many additional patients have not yet undergone imaging evaluation. It is important for these patients to undergo imaging evaluation to be considered as having a confirmed objective response. Thus, as additional patients undergo such an evaluation, then it’s possible that more patients could later be classified as having a confirmed objective response. This is not guaranteed to happen, but highly possible. With all the positive data in hand, PDS expects to submit an amended Investigational New Drug [IND] application to the FDA in Q3 of 2023. The reason for doing so is to be able to eventually initiate its phase 3 VERSATILE-003 study, which is going to use PDS0101 in combination with Keytruda to treat patients with HPV16-positive HNSCC.
Financials
According to the 10-Q SEC Filing, PDS Biotechnology had cash and cash equivalents of approximately $65.2 million as of March 31, 2023. It believes that this will be enough cash to fund its operations into Q3 of 2024. However, it has been able to raise cash by other means. I’m talking about an “At Market Issuance Sales Agreement, or the Sales Agreement, with B. Riley Securities, Inc. and BTIG, LLC as well. This was an agreement made with both companies by which PDS Biotech could offer and sell, from time to time at its sole discretion, shares of its common stock with an aggregate offering price of up to $50 million. For the year ending December 31, 2022 it sold 1,238,491 shares of its common stock which helped it to raise $9.9 million. Then, in the quarter ending March 31st 2023, it sold 553,293 shares of its common stock that helped it to raise approximately $4.6 million pursuant to the Sales Agreement.
Risks To Business
There are several risks that investors should be aware of before investing in PDS Biotechnology. The first risk to consider would be with respect to the advancement of the soon to be initiated phase 3 VERSATILE-003, which is using PDS0101 in combination with Keytruda to treat patients with HPV16-positive head and neck squamous cell carcinoma [HNSCC]. That’s because with the phase 3 being initiated in late 2023, it could be a few years before data is released from it for starters. Secondly, even though this biotech was able to obtain positive results from the phase 2 VERSATILE-002 study in fewer patients, there is no guarantee that similar or superior results will be obtained upon trial data being released for VERSATILE-003. A second risk to consider would be the financial position that this company is in. That’s because it believes that it has enough cash to fund its operations into Q3 of 2024. With this being about one-year worth of cash, it is highly likely that it may need to enact a cash raise soon. In the meantime, it has been selling some shares from its ATM agreement as I noted above.
Conclusion
The final conclusion is that PDS Biotech is a good speculative biotech play to look into. That’s because it is gearing up to initiate its phase 3 VERSATILE-003 study, which is using PDS0101 in combination with Keytruda to treat HPV16-positive HNSCC patients. An amended protocol, which the biotech expects to submit in Q3 of 2023, will allow to initiate such a phase 3 study. The HNSCC market is a large one and it is still a huge unmet medical need. The head and neck cancer market is expected to reach $9.07 billion by 2030. This is a huge market opportunity and if PDS can eventually obtain FDA approval of PDS0101 for the treatment of this patient population, then it will be in good shape to go after it.
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