It has been approximately three months since I previously broke the story on Epizyme’s (EPZM) tazemetostat after its initial approval for metastatic or locally advanced epithelioid sarcoma not eligible for complete resection. If you are new to the Epizyme and tazemetostat story, I recommend you read that article first for a good background. Now, we are now approaching one month to tazemetostat’s second PDUFA date of 6-18-2020. This sNDA for the treatment of relapsed or refractory follicular lymphoma after 2 lines of systemic therapy is being reviewed under the FDA’s priority review timeline. If approved, this would be an accelerated approval, meaning that Epizyme will still need to run a confirmatory trial to maintain marketing approval in the follicular lymphoma indication. So lets take a look at tazemetostat for follicular lymphoma. Follicular lymphoma is a type of blood cancer, with around 14,000 new diagnoses annually in the United States. Now typically, patients will unfortunately relapse and require additional therapy after their first chemotherapy regimen. This leads to patients receiving second and third line therapy, which is where tazemetostat comes in, for the treatment of patients whose lymphoma has progressed after other chemotherapy regimens. It is estimated that around 75% of patients will eventually progress to receiving third line therapy. Those patients who do not go on therapy have either tragically passed away or have experienced side effects from medications making them uncertain about receiving additional therapy. One of the factors contributing to these patients not wanting to continue on therapy are the lack of effective therapies that are devoid of significant side effects. As described in the recent Epizyme conference call, they will be targeting the current market that is occupied by PI3K inhibitors. These include duvelisib (marketed by Verastem), copanlisib (marketed by Bayer), and idelalisib (marketed by Gilead). The issue is these drugs have significant side effects, which has led to them having Black Box Warnings for events such as hepatotoxicty, diarrhea, colitis, intestinal perforation, and severe infections. These significant adverse events are paired with fairly lack luster efficacy, providing a less than favorable benefit to risk ratio. So how does tazemetostat stack up against these PI3K inhibitors? Lets take a look (Figure 1). Please note, there are two columns for tazemetostat, one for patients with wild type (WT, non-mutated) and mutant type (MT) disease. The specific mutation is activating mutations of the EZH2 gene, which turns the normal cells into cancer cells. First, let’s look at the safety of tazemetostat. Grade 3 adverse events are defined as “Severe but not life threatening; hospitalization required; limitation of patient’s ability to care for him/herself.” As such, tazemetostat has the clear safety benefit, with no grade 3 adverse events reported in greater than 10% of patients. This contrasts with adverse events occurring in ≥30% patients like neutropenia for duvelisib or hyperglycemia with copanlisib. Now, let’s look at efficacy. Each agent has a fairly similar patient population with regards to age and number of prior therapy, however duvelisib does have more patients that were refractory to their last therapy (a negative prognostic factor). For patients with wild type EZH2, tazemetostat shows a marginally lower over all response rate (ORR). What Epizyme claims is the benefit, though, is that the median duration of response for those who respond exceeds the competitors. Furthermore, this is paired with its favorable safety profile relative to others. So in wild type patients, we have an agent where a few less patients respond, but those who do have longer responses, and the drug is far more tolerable. Looking at mutant type EZH2 patients, has the best ORR among the competitors that are unselected for any mutations, which is to be expected when a medication is specifically targeted. What is exciting, is that the median duration of response has yet to be reached at a median follow up of 15.9 months, meaning it will be around or beyond this value. So in mutant type patients, tazemetostat results in more patients responding, for a longer time, with better tolerability. This is a win-win-win for Epizyme. I will point out that there is one company with a PI3K inhibitor under review by the FDA. That is umbralisib from TG Therapeutics (TGTX). However, the data from this study has yet to be published. So how many follicular lymphoma patients are there? It is estimated that around 20% of patient have and EZH2 mutations. This means that the wild type indication has around 8,880 patients annually, and mutant type has around 2,220 patients annually. It is likely that the mutant type patients would be most likely to see rapid uptake of tazemetostat if approved. But one may argue that the wild type should also see a fair amount of uptake, if approved, given the dismal risk/benefit of other PI3K agents. Using my estimates, the total addressable market here is around $1.5 billion annually from both patient populations: $350M from mutant type, and $1.15 billion from wild type. So as you can see, this could be a massive market for opportunity for Epizyme, with what I perceive to a medication that will be widely welcomed from oncologists. In fact, Epizyme has said that doctors have already started using the medication in follicular lymphoma on their conference call. There is one overhang that gives me pause at this point. The major medical conference ASCO is upcoming. There are several studies being published, which over appear fairly positive, except a pediatric study. This study shows reasonable promise, however one patient did develop a secondary malignancy (a new cancer that is different from the one being treated). Now, often chemotherapy can result in secondary malignancies, so this is not unheard of at all. Furthermore, secondary malignancies have not been reported in other trials with tazemetostat. So in the long run, I am not concerned, but I am uncertain how the market will acutely react to this news, but could see it being glossed over, or triggering a sell off. Again, I will underscore that this is a side effect seen of chemotherapy, and I am not concerned in the long run. Especially considering that this patient was receiving a dose higher than the studied and FDA approved dose. With regards to financials, Epizyme is in a good position. They ended the first quarter of 2020 with $376.5 million, which they estimate will carry them into at least 2022. Since this is a commercial company, we will need to see how the revenue grows, and by how much expenses grow as trials expand. Again, for the full financial details on tazemetostat, please refer to my previous piece where that is outlined.
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