After months of uncertainty regarding the fate of binimetinib, Array (ARRY) announced it regained full rights for the drug from Novartis (NVS). Binimetinib (MEK162) was originally partnered with Novartis in 2010 (discussed here) and has been aggressively pursued since. Novartis had to return binimetinib back following the acquisition of GSK’s (GSK) oncology portfolio which included Mekinist, a MEK inhibitor approved for melanoma. Although binimetnib has a high likelihood of returning to Array, the decision is still subject to final approvals for the GSK-Novartis deal.
Surprisingly favorable deal terms
Deal terms are extremely positive as they provide Array with a significant upfront payment (up to $85M), transfer of all the relevant regulatory and IP materials, and significant future funding for ongoing P3 trials.
The biggest surprise was Novartis’ commitment to supply some of its investigational drugs that are in ongoing combination studies with binimetinib. Moreover, Novartis will provide the compounds to Array should the combinations reach phase III trials. Preliminary results for two of these combination studies were presented at ASCO and provided intriguing efficacy signals (see abstracts for combination trials with LEE011 and BYL719).
This has important implications as it will allow Array to stay competitive in the crowded MEK arena. Without Novartis’ commitment, Array would have had to get similar drugs via collaborations with other companies, which could have created a 2-year delay in development timelines (need to do phase I portions again). It also eases some of the pressure to find a partner for binimetinib.
Interest in MEK inhibitors is at its peak
Getting binimetinib back is great news for Array, which will transform to a phase III company on the verge of commercialization. Binimetinib is being studied in three pivotal trials (melanoma and ovarian cancer) as well as multiple phase II studies (see figure below).
MEK inhibitors went in and out of favor, but are now emerging as promising drugs, especially for tumors with mutations in the MAPK pathway (RAS-RAF-MEK). Array has the broadest exposure to the MEK opportunity as the only company with exposure to two MEK inhibitors: Binimetinib and selumetinib (partnered with AstraZeneca[AZN]). It is also important to note GDC-0994, an ERK inhibitor partnered with Genentech. ERK is downstream of MEK and may open up new opportunities in tumors with dysregulated MAPK pathway.
The initial wave of clinical data (2008-2011) with MEK inhibitors has been disappointing. As monotherapy, MEK inhibitors demonstrated limited efficacy and dosing was limited by side effects (especially skin and hematological toxicities). In recent years, the outlook for MEK inhibitors has gradually improved following promising clinical data across multiple indications, driven by rational combinations and accurate patient selection.
The strongest validation for MEK inhibitors is obviously in BRAF+ melanoma, where two different MEK inhibitors (from GSK and Roche, respectively) led to a significant increase in overall survival when added to a BRAF inhibitor (See publications here and here). Other trials demonstrated promising signals of activity in lung, colon and ovarian cancers with BRAF or RAS mutations. A new and exciting approach is combining MEK inhibitors with PD-1 antibodies, pursued by Roche (with Exelixis’ MEK inhibitor).
Imminent fundraising, licensing deal
By regaining rights for binimetinib, Array finds itself in an unusual position. One the one hand, it has a drug that requires a massive infrastructure and ~$200M in development costs over the next 2-3 years (on top of the funds received from Novartis). On the other, it has under $100M in cash and a debt of ~$100M (before receiving any funds from Novartis). Therefore, the most important question going forward is how Array chooses to fund binimetinib’s clinical development.
In the very near future, Array will likely raise money in order to provide financial stability and remove the liquidity overhang. The next step would be a new licensing deal for binimetinib which will enable Array to offset some of the cost as well as pursue additional combination regimens. Array does not have a lot of options given the large number of MEK inhibitors in the clinic (From Roche, AstraZeneca, Novartis, Bayer and Merck Serono). Potential partners are global companies (Array will probably keep some US rights) with interest in late stage oncology assets. These include Pfizer (PFE) (who had a 1st gen MEK inhibitor and was interested selumetinib as part of the Astra bid), Merck (MRK) (PD-1 combinations in lung and colon) and Lilly (LLY) (MEK inhibitors can complement Erbitux in KRAS+ colon cancer).