Multiple sclerosis is one of the most detrimental progressive diseases that doesn’t have a cure. Even if it were to be caught early, the current treatment can only slow the progression of multiple sclerosis by reducing nerve cell inflammation and damage. Basically, multiple sclerosis is where the protective coating of nerves in the spinal cord and the brain gets damaged and destroyed by the body’s own immune system. So it can lead to symptoms such as vision loss, muscle spasms, and impaired coordination. Unfortunately, the cause of this disease is unknown.
There are four different stages of multiple sclerosis: Clinically Isolated Syndrome (CIS), Relapsing-remitting MS (RRMS), Primary progressive MS (PPMS), Secondary progressive MS (SPMS).
Clinically Isolated Syndrome (CIS) is where neurologic symptoms such as impaired coordination and muscle function occur for at least 24 hours.
Relapsing-remitting MS (RRMS) is where there are relapses (new or worsening attacks of symptoms) and remission (recovery) in between. So the painful neurologic symptoms come and go intermittently. 85% of multiple sclerosis patients are first diagnosed with RRMS.
Primary progressive MS (PPMS) is steadily worsening neurologic function from the beginning with no relapse and recovery in between.
Secondary progressive MS (SPMS) comes after the first relapsing-remitting course where the patient’s neurologic function progressively gets worse as time passes.
The medications used to treat multiple sclerosis depend on the type mentioned above. Overall, there are three pipeline medications to look forward to that are currently in or recently completed phase 3 clinical trials.
1. Evobrutinib by Merck, KGA ($MKKGY)
Evobrutinib inhibits BTK (Bruton’s tyrosine kinase), which is a protein in B cells. Inhibiting this protein leads to a depletion of B cells and therefore less attacks mediated by B cells in RRMS. Even though B cell depletion is a good way to treat multiple sclerosis, it is not as easy as it sounds. In fact, evobrutinib is the first and only medication in the BTK inhibitor class that has shown to be effective in reducing inflammation that causes neuronal damage in the brain and spinal cord. It is also the first BTK inhibitor to complete enrollment for phase 3 clinical trial of over 1800 patients with RRMS. These participants will either get (“sugar” pill that doesn’t have a therapeutic purpose), Sanofi’s Aubagio (teriflunomide, which is the current standard of care) or evobrutinib.
The results from the phase 2 study of evobrutinib were extremely promising and worth looking forward to. At the highest dose tested, evobrutinib reduced the relapse rate of RRMS from 0.37 relapses per year in placebo group to 0.11 relapses per year in the evobrutinib group. Also, 79% of the evobrutinib group did not relapse at all after 48 weeks. But is it safe? Well.. most, if not all, drugs have side effects and the most common side effects of evobrutinib are a common cold and potential liver damage due to an elevation of ALT (liver enzyme). However, there aren’t any associated serious side effects such as infections or reduced white blood cells. Now that we know it is effective and fairly safe compared to placebo, it is now time for it to be compared to teriflunomide, which has the most market share in the RRMS market. About 570,000 people are diagnosed with MS, 85% of which is RRMS. Therefore, 484,500 is a pretty big target patient population even if half of them (242,250 RRMS patients) end up getting treated with evobrutinib. But for investors, time will only tell as evobrutinib has to be either more effective or much cheaper for patients to actually have access to this medication.
2. Ublituximab by TG Therapeutics ($TGTX)
Like evobrutinib, ublituximab works by targeting B cells but in a different way. By targeting the CD20 protein on B cells, it leads to destruction of B cells which ultimately reduces neuronal damage and relapse rate in RRMS. In its phase 3 trial (ULTIMATE I), ublituximab has shown to decrease the annual relapse rate by 60% compared to Sanofi’s teriflunomide. This result was not due to simple luck because in another phase 3 trial (ULTIMATE II), it led to a 50% relative reduction compared to teriflunomide. Ublituximab was also generally well-tolerated with no serious adverse events. The most common one was infusion related reactions, such as nausea, headache, and rash. This was experienced at least once by 47.7% of the participants in the ublituximab group compared to 12.2% in the teriflunomide group.
For context as to how lucrative teriflunomide (Aubagio manufactured by Sanofi) is, its 2019 net sales were $2.14 billion. Teriflunomide is currently used as first-line treatment for RRMS, it was appropriate for TG Therapeutics to compare its drug to teriflunomide. In fact, ublituximab has shown to be more effective in reducing the relapse rate compared to teriflunomide. Therefore, ublituximab has a very high chance of getting a large piece of that $2.14 billion. For a fairly small biotech company that only has one medication approved, this piece is a very large deal.
Ublituximab is also being investigated to be used in certain types of cancer known as Non-Hodgkin lymphoma (NHL) and chronic lymphocytic leukemia (CLL). The stock price has fluctuated dramatically over every FDA intervention, whether it is meeting request or a partial hold on a clinical study. On the brighter side, FDA accepted ublituximab’s biologics license application for RRMS at the end of 2021. Even though FDA approval will lead to a skyrocketing stock price, recent investors are still in for a bumpy road.
3. Masitinib by AB Science ($ABSCF)
Masitinib inhibits tyrosine kinase, which is an enzyme that allows for communication and regulation of a cell. So by inhibiting this enzyme, masitinib regulates cells of the immune system and ultimately stops “bad” cells from growing and dividing. This drug is being developed to be used for neurology, inflammatory diseases, and oncology. Specifically, it has shown promising phase 2b or 3 data for various diseases: amyotrophic lateral sclerosis, multiple sclerosis, Alzheimer disease, mastocytosis, severe asthma, prostate cancer and pancreatic cancer. It has even shown to anti-viral activity on COVID-19 in the lab. If this drug were to get approved for these indications, it has blockbuster potential written all over it.
AB Science currently only has two medications in its pipeline, with the second one AB8939 in pre-clinical studies for acute myeloid leukemia. But because over 4000 patients have already gotten this treatment and have shown robust clinical trial data for various indications, it’s about the quality over quantity.
At this stage, it is hard to pick out which medications have the highest chance of getting the stamp of approval from the FDA. Usually, the general rule of thumb is that pharmaceutical giants like Merck have a much more stable return than small biotech companies like TG Therapeutics and AB Science. However, if you’re looking for slow and steady returns, S&P 500 ($SPY) might be a safer and more lucrative bet.
It’s important to keep in mind which form of multiple sclerosis these drugs are being developed to treat.
- Evobrutinib: relapsing-remitting multiple sclerosis (RRMS)
- Ublituximab: RRMS and secondary progressive MS (SPMS) with relapses.
- Masitinib: Primary progressive MS (PPMS) and SPMS
Because 85% of multiple sclerosis diagnoses is relapsing-remitting (RRMS), there is a bigger role for evobrutinib and ublituximab than masitinib in multiple sclerosis because they will be able to reach a much broader patient population with MS. But regardless, multiple sclerosis is a very lucrative market with many clinical unmet needs. In fact, by 2023, the MS market size is estimated to be worth $42.46 billion at a CAGR (Compound Annual Growth Rate) of 6.3%. Even if all of these medications were to be approved, these companies do not have to worry about their return on investment from the competition.