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Basilea - A burgeoning oncology pipeline

The R&D pipeline at Basilea is now dominated by its significant investment creating a substantial oncology franchise. While much investor focus has been on the progression of FGFR inhibitor derazantinib in various FGFR driven tumours, lisavanbulin has generated impressive data in glioblastoma, targeting the mitotic spindle assembly checkpoint (SAC).

Basilea previously announced that it was seeking to progress its first-in-class small molecule drug candidate BAL0891 into the clinic, with a Phase 1 study in solid tumours planned for early 2021. This morning, Basilea confirmed that the US FDA has approved the IND for BAL0891, and has also provided further details on its mode of action. BAL0891 is a first-in-class mitotic checkpoint inhibitor, with a dual-mode of action targeting both threonine tyrosine kinase (TTK) and polo-like kinase 1 (PLK1). The approach of targeting tumour cell mitosis is well characterised, both in oncology generally and at Basilea through the action of lisavanbulin. The objective is to force tumour cells to experience aberrant mitosis leading to tumour cell death. With both TTK and PLK1 involved in activating the mitotic spindle assembly checkpoint, we anticipate that BAL0891 should be a potent anti-cancer agent. Basilea also provided some preliminary evidence of efficacy in preclinical cancer models, including several tumour cell lines in vitro as well as single-agent activity in in-vivo models of solid human cancers.


2022 promises to be a critical year in the development of Basilea's oncology franchise. In particular, we look forward to data emerging from derazantinib as it progresses through multiple studies in biliary (FIDES-01), bladder (FIDES-02) and gastric cancer (FIDES-03). Derazantinib is not first-in-class, but it has the potential to be highly differentiated from currently approved FGFRis and provide an effective treatment option in various FGFR-driven cancers.


Interim data from the ongoing lisavanbulin study in glioblastoma are also anticipated in H1 2022. Although still early days, such has been the scale of the benefit observed in some glioblastoma patients that we await, with considerable enthusiasm, disclosure of these results.


We calculate a discounted cash flow fair value of CHF120 per share for Basilea.


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IMPORTANT:

Basilea Pharmaceutica is a client of Calvine Partners, and as such, this publication is not independent and should be considered a marketing communication under FCA Rules. None of the information contained in this publication should be considered as any form of advice.

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