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Expert Financial Analysis and Reporting

Chimerix: Upgrading the Stock to a Buy (CMRX. Buy, $6.10)

Definitions of Key Words

This section defines a number of words, phrases and acronyms that I have used in this report that may be useful for investors who may not have already done extensive research on Chimerix.

virus: A virus is a small, non- bacterial, infectious agent that replicates only inside the living cells of other organisms. When not inside an infected cell or in the process of infecting a cell, viruses exist in the form of independent particles called virions that have two or three parts: (1) genetic material made from either DNA or RNA, (2) a protein coat, called the capsid, which surrounds and protects the genetic material; and in some cases (3) an envelope of lipids that surrounds the protein coat when virions are outside a cell. The virus hijacks DNA of infected cell to make more virions which go on to attack other cells. The average virion is about one one-hundredth the size of the average bacterial cell.

double stranded DNA virus (dsDNA): This type of virus’s genetic information is replicated by double stranded DNA. Other type of viruses have different replication strategies.

brincidofovir: This is the only drug of Chimerix in clinical trials. It was developed by adding a lipid tail to an approved anti-viral drug- Gilead’s Vistide (cidofovir).This greatly improved the efficacy and safety of Vistide by enabling more  cidofovir to be released within cells and leaving less in the blood stream where it can cause side effect issues. While this sounds like a drug delivery mechanism, the technology results in a new molecular entity that has composition of matter patent protection which in the case of brincidofovir extends until 2034. Brincidofovir is a nucleotide analogue that is effective against dsDNA viruses.

hematopoietic stem cell transplant (HCT): This procedure transplants multipotent hematopoietic stem cells, usually derived from bone marrow, peripheral blood, or umbilical cord blood. The source may be autologous (the patient's own stem cells are used) or allogeneic (the stem cells come from a donor). It is a hematological procedure most often performed for patients with certain cancers of the blood or bone marrow, such as multiple myeloma, lymphomas or leukemias. In this procedure, the recipient's immune system is usually destroyed with radiation or chemotherapy before the transplantation. Infection and graft-versus-host disease are major complications of allogeneic HSCT.

graft versus host disease (GVHD): This is a complication that can occur after a stem cell or bone marrow transplant. With GVHD, the newly transplanted donor cells attack natural cells in the transplant recipient's body.

cytomegalovirus (CMV: A dsDNA virus which is a member of the herpes family. About two-thirds of Americans have had a CMV infection that seldom causes major issues but remains latent for life. However, in immune-suppressed patients like HCT patients, CMV can be reactivated and cause severe morbidity and mortality.

adenovirus (ADV): This is a dsDNA virus that causes the common cold. However, in immune-suppressed HCT patients it can lead to serious disseminated infections that have a high rate of mortality.

BK-virus: A particularly dangerous dsDNA virus in solid organ transplant patients.

smallpox: Another dsDNA virus that has been eradicated from the global population, but could be released through terrorism or accidental release from government research facilities.

SUPPRESS: A placebo controlled, double blind phase 3 trial deigned to show that brincidofovir could reduce the incidence of CMV reactivation in HCT patients. It was just announced that this trial failed to reach the primary endpoint.

AdVise: An open label, phase 3 trial of brincidofovir in adenoviral infections. Topline results are expected in 2H, 2016.

SUSTAIN and SURPASS: Phase 3 trials of brincidofovir designed to show that the drug can prevent reactivation of CMV infections in kidney transplant patients and improve the functioning and longevity of the donated kidney. These trials began in mid-2015 and new enrollment has been temporarily halted pending analysis of the SUPPRESS data.

Detailed Chimerix Investment Thesis


My investment history with Chimerix can be seen in the Reports section of my website. I have always liked the investment potential of its lead drug brincidifovir, but the stock price has usually been too high for me to recommend purchase. In the aftermath of the stunning failure of brincidofovir to achieve the primary endpoint the phase 3 SUPPRESS trial, Chimerix’s stock declined from $36 to $7. I think that this decline is significantly overdone and I am going to a buy on the stock. There remains significant potential for brincidofovir in the treatment of severe adenoviral infections with topline results from a phase 3 trial due in 2H, 2016. I believe there is a good chance that results will be positive leading to approval for this indication in 2017. BARDA has also chosen brincidofovir to be the sole agent to be stockpiled in case of a smallpox outbreak due to terrorism or accidental release from government research stockpiles. Also, the failure of SUPPRESS does not necessarily mean that brincidofovir will not be successful in preventing CMV reactivation in kidney transplant patients. This is the subject of two phase 3 trials in which enrollment was temporarily halted until results from SUPPRESS are more fully analyzed. I believe these phase 3 trials could resume by mid-year; this is potentially an extremely important indication.

Brincidofovir is essentially a pipeline in a single drug and despite the failure in the SUPPRESS trial, the Company has an extremely strong late stage pipeline. Chimerix also has the good fortune of being well financed and having estimated cash position of $360 million at the end of 2015. There is no need for financing until well into 2017 or beyond. Also, brincidofovir has a patent which protects the product into 2034. The Company has ample cash and patent protection to carefully develop its products and enjoy a long commercial monopoly. The current market capitalization of $400 million seems quite low when comparing to other late stage companies. I am moving to a BUY on the stock.

There are a number of key catalysts coming up in 2016. In coming weeks, more detailed analysis of SUPPRESS could provide useful information in regard to the effect of brincidofovir in treating adenoviral infections and could point to a new path forward in preventing CMV in HCT patients. We should see the phase 3 results from AdVise in 2H, 2016 that could result in approval in 2017. Also, the SUSTAIN and SURPASS trials in kidney transplant patients could resume enrollment; this is a major commercial opportunity if results are positive. I would expect topline results from these trials in 2018, but the Company may engineer in an interim look (in the aftermath of SURPASS) that could provide an insight into efficacy before then.

Failure of SUPPRESS Trial Was a Crushing Blow

The failure of brincidofovir in the key phase 3 SUPPRESS trial was a crushing blow to the Company and its stock. SUPPRESS’s primary endpoint was to show that brincidofovir could significantly reduce the reactivation of CMV infections in HCT patients. Brincidofovir had shown strong antiviral effects in in vitro studies which are usually highly predictive of in vivo activity for an antiviral drug. Also a phase 2 trial in this same patient population produced encouraging, statically significant results. Investors were assigning a very high probability of success in this trial, substantially in excess of 50%.

Management has only had a chance to look at limited topline results and is just beginning to delve into more detailed data. A more complete analysis and understanding of the reasons for the trial failure will be made in coming weeks. Chimerix will present a detailed analysis at the BMT Tandem conference during February 18 to 22 in Honolulu. As I will discuss later, the more detailed data analysis could offer not only insights into the reason for the trial failure, but also important insights into how the drug may be developed and used in other therapeutic opportunities such as adenoviral infections and preventing viral infection in solid organ transplants.

The failure of a clinical trial is obviously a major negative for a drug, but does not necessarily mean that the drug is ineffective in that indication or other indications. Clinical trials are very difficult to design and execute and there are numerous things that can go wrong such as

  • incorrect dosing,
  • wrong clinical endpoints are chosen,
  • patient population enrolled may be too heterogeneous,
  • high withdrawal rate due to side effects or other issues,
  • some trial sites don’t properly follow protocol of trial,
  • randomization is incorrect,
  • other.

In going through the topline data, management was not able to identify issues that clearly explained why the phase 3 SUPPRESS trial did not replicate very favorable results of phase 2. In SUPPRESS the incidence of CMV reactivation in brincidofovir patients was slightly higher than in the control arm and there was a trend toward (not statistically significant) higher mortality in the brincidofovir arm. In the brincidofovir arm there was increased incidence of GVHD and with that there was the need for increased use of steroids as compared to the control arm. Steroids treat GVHD by suppressing the immune system, but this makes infection with CMV and other pathogens more likely. Why there was increased GVHD with brincidofovir is unclear.

Management noted that the only significant difference between the phase 2 trial and SUPPRESS was that in phase 2, brincidofovir was started after engraftment of the stem cell transplant while in phase 3 it was started before. There were no side effect or abnormal withdrawal issues and the randomization of the trial seemed to be well executed. As it gains more access to broader data sets, management will look at outcomes of sub-groups of patients in which brincidofovir was very effective or ineffective. It may or may be the case that another trial of brincidofovir to prevent CMV reactivation could be undertaken in a sub-group. However, it that is the case, it would likely be 2019 or so before results in the new trial could be determined. Effectively, the use of brincidofovir in treating CMV reactivation in HCT patients does not figure in my current investment thesis.

AdVise Trial in Adenoviral Infections is Very Important to Stock Performance

Investors must now look at other indications in which brincidofovir may be effective. It is a broad spectrum anti-viral agent which is highly effective in vitro against all strains of dsDNA virus such as adenovirus, smallpox and BK virus. The Company is conducting a phase 3 trial of brincidofovir for treating adenoviral infections called AdVise. Because of the immediate, life threatening nature of such infections, for ethical reasons the FDA did not insist on a controlled trial.

AdVise is an open label trial so that management and investors can see results as they occur; to date they seem highly encouraging. The mortality rate for disseminated, adenoviral disease in children is suggested by the literature to be as high as 80% and in the AdVise the mortality rate is 40% after 90 days of brincidofovir treatment. However, the 80% figure is not well documented so that concurrent with AdVise, Chimerix is conducting a matched pair trial which looks at outcomes in similar patients who do not receive brincidofovir.

If the mortality rate in the matched control arm validates a mortality rate of perhaps 60% or higher, brincidofovir could be approved on the basis of AdVise results alone. This is even though AdVise is a single arm, open label study with only 100 patients in Cohort B which is the most vulnerable group of allogeneic, pediatric HCT patients with disseminated adenoviral infection. The results of AdVise should be available in 2H, 2016. If the mortality rate for brincidofovir holds at 40% and the mortality rate in the matched control arm is 60% or higher, I think that brincidofovir could be approved for this indication in 2017. This could provide a major boost to the stock.

BARDA Stockpiling of Brincidofovirin the Event of a  Smallpox Epidemic

BARDA has already awarded single procurement status to brincidofovir for the treatment or prevention of smallpox in the event of a terrorist attack or accidental release from research stockpiles. This could result in initial delivery of a maximum of 1.7 million treatment courses over the 60 month period starting in September 2015 for a value of approximately $100 million. Beyond this, if all options are exercised by BARDA, the total dollar value could be as much as $435 million.

It is unethical to investigate the treatment of certain drugs in humans with smallpox being a perfect example. In these case, BARDA will award a contract on the basis of studies in two animal models that demonstrate efficacy. Brincidofovir has only demonstrated efficacy in a rabbit model and may have to complete a trial in a second animal model. This creates some uncertainty that the FDA will require another study in animals before approving brincidofovir for this indication. I regard this as a supporting, but not dominant part of the Chimerix investment thesis.

Prevention of CMV Infections in Kidney Transplant Patients Could Potentially Be a Major Commercial Opportunity

Chimerix had begun enrolling in 2015 two large phase 3 trials, SUSTAIN and SURPASS for the prevention of CMV reactivation in kidney transplant patients and to improve the functioning and life in the recipient of donated kidneys. These trials have temporarily halted until the SUPPRESS results have been better evaluated to see if they have any implications for these two trials.

Based on limited knowledge of the SUPPRESS trial data, I would not expect this so have any implications and would expect enrollment to be resumed, probably in 1H, 2015. The SUSTAIN trial was originally scheduled to finish in September 2018 and SURPASS in January 2017. However, management has suggested that they may engineer an interim look (in the aftermath of SUPRESS) into these trials to get an earlier look as to whether brincidofovir is active in this setting.

Strong Financial Position and Brincidofovir's Long Patent Life Are Major Investment Positives

Chimerix had an estimated cash position of $360 million at the end of 2015 as a result of three equity raises over the last year and one-half: 2Q, 2014 ($112 million), 4Q, 2014 ($114 million) and 2Q, 2015 ($161 million). At the most recent quarterly burn rate of $20 million per quarter, this cash would last for four years. However, there are several factors that could affect the burn rate going forward such as building a commercial sales organization if brincidofovir is approved for adenoviral infections. Also, if SUSTAIN and SURPASS enrollment is restarted, the burn rate will continue at a very high rate. If not, the burn rate will drop sharply. The Company isn’t giving guidance but even in the most high burn rate scenarios, the Company is in an enviable cash position. Brincidofovir also has composition of matter protection on brincidofovir that extends until 2034. Two of the most compelling investment features about Chimerix are that it will not likely need financing in the next two to three years and the patent life gives the Company a long highway for commercializing brincidofovir for indications that are the subject of current trials and may be the subject of future trials.

Summary of Investment Position

There are compelling reasons to think that the failure in SUPPRESS was a temporary setback and that the broad, late stage clinical trial program has significant commercial opportunity that could lead to outstanding growth potential through 2034. If so, Chimerix is a compelling investment opportunity. However, while I think the risk is low, it cannot be ruled out completely at this time that SUPPRESS has unveiled a flaw in the therapeutic profile of brincidofovir that could prevent commercialization. To me, the reward/ risk ratio is very favorable and results in my upgrading the stock to a Buy.

Discussion of the Failure of SUPPRESS Trial

Failure of Phase 3 SUPPRESS Trial is a Major Disappointment

On December 28, 2015 Chimerix announced that the phase 3 SUPPRESS trial had failed to meet its primary endpoint which was to prevent clinically significant cytomegalovirus (CMV) infection through a 24 week period following hematopoietic stem cell transplantation (HCT). A full analysis of the SUPPRESS trial results is ongoing and will be presented at the BMT Tandem Meetings in Honolulu, Hawaii, to be held on February 18-22, 2016. In the interim, there may be some information released.

Management stated during a conference call that they remain committed to the brincidofovir program both in HCT and other indications. For the HCT patients treated in the SUPPRESS trial there is no currently available therapeutic option approved to prevent life threatening dsDNA viral infections. So far, they have only seen topline data and seen very limited data. In the weeks leading up to the BMT Tandem conference, they will have the opportunity to closely examine all aspects of the trial. They will carefully analyze the results of SUPPRESS to see if a difference in trial design might produce a positive outcome or if there are specific sub-groups in a highly heterogeneous HCT population that might benefit from the drug. This could be the basis for another pivotal trial.

Design of SUPPRESS Trial

The trial enrolled and treated 452 adult high-risk allogeneic HCT recipients.  All patients in the trial were CMV seropositive (had antibodies to CMV as a result of a prior infection), placing them at high risk of recurrence of a CMV infection. The most common indications leading to stem cell transplantation in the SUPPRESS trial were blood cell cancers: acute myelogenous leukemia (43% of patients), myelodysplasia (17%), non-Hodgkin's lymphoma (10%), and acute lymphocytic leukemia (9%). Patients were treated with brincidofovir for 14 weeks (the period of highest risk for CMV infections) and then taken off the drug and followed for another 10 weeks. The endpoint of the trial was to reduce the incidence of clinically significant cytomegalovirus (CMV) infection at the 24 week endpoint as compared to a standard of care control arm.

Results of SUPPRESS

At 24 weeks, there was a slight increase (not statistically significant different) in the rate of CMV reactivation (infection) in the brincidofovir arm as compared to the control arm. There was also a non-statistically significant increase in mortality in the brincidofovir arm compared to the control arm. During the initial 14 weeks of treatment, fewer patients in the brincidofovir arm had a CMV infection as was hoped, but this was not statistically significant. This was consistent with results seen in a previous phase 2 trial. However, in the next 10 weeks after patients were taken off drug, there was an increase in CMV infections in the brincidofovir as arm compared to the control arm.

At this very early stage of analysis, management said that the higher incidence of CMV infections and mortality correlated with confirmed cases of graft-versus-host-disease (GVHD) in the brincidofovir arm. GVHD was treated with extensive use of steroids that depress the immune system leading to more susceptibility to CMV (and other) infections). Investigators did not see this reoccurrence in a comparable patient group treated in a phase 2 trial. The key question to be addressed is why there was a higher incidence of GVHD in the brincidofovir group. Is this related to trial design, patient selection or some intrinsic property of brincidofovir?

The behavior of the control arm was in line with expectations based on a prior brincidofovir phase 2 study and historical studies. The rate of study drug discontinuation for gastrointestinal events (the limiting side effect of brincidofovir) was < 10% as was anticipated in the trial design. Discontinuation due to side effect issues does not appear to be a factor in the trial failure. The randomization procedure in SUPPRESS worked well to balance risk factors so this also does not appear to be a factor in the trial failure. The number of patients lost to follow-up was less than 10% and loss due to side effects was less than 10%. All data points to a well conducted trial and randomization. There were some differences at different sites.

Data Safety Monitoring Board Input Has Been Limited

GVHD is a leading cause of non-relapse mortality in the allogeneic stem cell transplant setting. An obvious question to ask is why the DSMB did not spot GVHD as a safety issue early in the trial? They were monitoring the incidence of GVHD as a safety issue. This suggests that most of the incidence of GVHD appeared late in the trial after brincidofovir was discontinued, i.e. in the 14 to 24 week period.

Based on preliminary discussions with the DSMB the CMV infection rate and mortality never reached statistical significance in the 14 weeks of treatment or during the following 10 weeks of follow-up. Also, the slight widening of the curves for mortality in favor of the control group weren’t known until the end of the study.

Possible Differences of SUPPRESS from Phase 2

The phase 2 results in a similar HCT patient group were very positive in showing a statistically significant improvement for brincidofovir over control and showed no evidence of increased incidence of GVHD after brincidofovir was discontinued. As management only has sparse topline data, there is much data left to be analyzed before hypotheses can be formulated to explain the difference in results in SUPPRESS and phase 2. One of the few differences between phase 2 and phase 3 was the time after transplant at which brincidofovir was started. In the phase 2 trial, brincidofovir was started after engraftment had taken place whereas in phase 3 it was started before engraftment. There were more sites involved in SUPPRESS and that may have led to different but potentially meaningful differences in outcomes

In trying to understand the unexpected occurrence of GVHD in SUPPRESS, they will reach out to investigators and key opinion leaders to try to understand. There are known risk factors for GVHD such as HLA and gender mismatched transplants. Could this somehow have been a factor? Also, treatment protocols vary at centers and this might also have been a factor. These include uses of myeloablative chemotherapy or non-ablative; various stem cell options; related and unrelated donors and the level of matching between recipient and donor. Also T-cells may or may not be removed before infusion leaving only the stem cells for infusion. T-cell depleted patients have a lower risk for GVHD. Some centers use cyclosporine or methotrexate. These site to site differences may explain the GVHD issue.

They saw in phase 2 that brincidofovir related diarrhea correlated with a diagnosis of GVHD at higher doses. This was something they were focused on as part of the safety and monitoring plan. This is something to be carefully analyzed in the SUPPRESS trial.

Trial of Brincidofovir in Adenovirus Infections

AdVise Trial in Adenoviral Infections

Chimerix is also conducting a phase 3 trial called AdVise in serious adenovirus infections which will report results in 2H, 2016. . Adenovirus causes upper respiratory infections, including the common cold and is not dangerous in individuals with a functional immune system. However, in people with a weakened immune system, such as patients who have undergone a transplant, adenovirus can lead to life-threatening infections, including pneumonia and hepatitis. The clinical literature suggests that the mortality rate in disseminated adenovirus disease can may be as high as 80% in patients who have undergone hematopoietic cell transplant (HCT).

Trial Design and Conduct of AdVise

AdVise is an open label study of brincidofovir for the treatment of both disseminated and also localized adenovirus infection in patients at increased risk of rapid progression to disseminated disease. Chimerix announced on September 8, 2015 that enrollment of more than 200 patients had been completed. This included 100 patients in the key population of HCT recipients (Cohort B) with disseminated AdV disease.

The Phase 3 AdVise trial began enrolling in March 2014. Patients with confirmed adenovirus infection receive brincidofovir orally twice-weekly for 12 weeks, and are followed for a minimum of 12 weeks after treatment. The trial is made up of three cohorts: Cohort A comprised of allogeneic bone marrow transplant recipients with asymptomatic or localized adenovirus; Cohort B comprised of allogeneic bone marrow transplant recipients with disseminated adenovirus disease; and Cohort C comprised of other immunocompromised patients, including autologous bone marrow transplant recipients, solid organ transplant recipients, and other patients with serious adenovirus infections. Over 100 patients were enrolled in Cohort B with disseminated adenovirus infection, as planned.

HCT recipients with localized or asymptomatic ADV infection were also enrolled in AdVise, as were patients with other reasons for immune suppression that had confirmed serious adenovirus infections; this group included solid organ transplant recipients and patients receiving chemotherapy. All patients enrolled in AdVise receive brincidofovir orally twice-weekly for 12 weeks, and are followed up to 24 weeks after treatment, with a primary endpoint of overall survival.

This is not a controlled trial and the literature does not have persuasive data on outcomes in patients currently treated with best available care. Remember there are no drugs approved for this indication. In order to get a better understanding of the outcome of current treatment, Chimerix is also conducting Study 305 to obtain clinical outcomes data in patients considered matched controls from the same medical centers as AdVise participants. The company will prepare data from the AdVise trial and the Study 305 historical matched controls to review with the FDA to determine the regulatory pathway for brincidofovir in the treatment of adenovirus.

Results in AdVise

Because AdVise is open label, the Company has seen that the approximately 100 COHORT B patients (those at very high risk) in the trial have experienced all-cause mortality of less than 40% at day 90. The literature suggests mortality as high as 80% in disseminated disease. It will be critical to see what the rate will be in matched historical controls. Data from the failed SUPPRESS trial may also give an insight into the effect of brincidofovir in adenovirus as the effect on ADV as a co-infection with CMV was a secondary endpoint.

Regulatory Strategy

Following the completion of the trial in 2H, 2016, they will have discussions with FDA about data from AdVise, SUPPRESS and Study 305 which will inform registrational strategy. A key question is whether (assuming a favorable outcome) this will be enough data to file for approval. This will depend on discussions with various regulatory bodies and will define next steps for an adenoviral indication.

There is uncertainty over whether they might have to do an additional controlled study to receive approval for the adenoviral indication? It is hard to speculate until they have the data from AdVise. In previous discussions with the agency they had ran through different scenarios for trying to conduct a controlled trial. However, because of the very high mortality rate in a short period of time and a predominantly pediatric population, the FDA, Chimerix and key opinion leaders concluded that a controlled trial was not ethically justified given the weight of the data on brincidofovir that they already had seen which showed a decreased mortality rate compared with what had been seen in the literature.

Other Drugs Have Been Approved on Basis of Matched Controls

On March 6, 2015 the FDA approved Cresemba (isavuconazonium sulfate), a new antifungal drug product used to treat adults with invasive aspergillosis and invasive mucormycosis. The approval of Cresemba to treat invasive aspergillosis was based on a clinical trial involving 516 participants randomly assigned to receive either Cresemba or voriconazole, another drug approved to treat invasive aspergillosis.

Cresemba’s approval to treat invasive mucormycosis was based on a single-arm clinical trial involving 37 participants treated with Cresemba and compared with the natural disease progression associated with untreated mucormycosis. Both studies showed Cresemba was safe and effective in treating these serious fungal infections. The endpoint of overall mortality also works in favor of approval as obviously this is a very hard endpoint.

Brincidofovir Used to Treat or Prevent Smallpox

Brincidofovir for Smallpox

Brincidofovir has demonstrated broad-spectrum in vitro activity across five families of dsDNA viruses which includes smallpox, a dsDNA virus. It is being developed as a medical countermeasure for smallpox in the event of a bioterror attack or accidental release. The U.S. FDA has granted Fast Track status to brincidofovir for treatment of smallpox.

Smallpox is estimated to have killed more than one billion people worldwide prior to its eradication declared by the World Health Organization in 1980 following a global vaccination campaign. Smallpox stocks remain for research purposes in the United States and Russia; however, undeclared stocks are suspected to exist elsewhere. Routine smallpox vaccination programs were discontinued after the global eradication, and with no antiviral agent approved for the treatment of smallpox, the U.S. population could be susceptible to a bioterror attack with devastating consequences.

Contract with BARDA

Biomedical Advanced Research and Development Authority (BARDA) is a department within the Office of the Assistant Secretary for Preparedness and Response in the US Department of Health and Human Services. It provides an integrated, systematic approach to the development and purchase of the necessary vaccines, drugs, therapies, and diagnostic tools for public health medical emergencies such as a smallpox epidemic.

On September 14, 2015 Chimerix announced an extension of its contract with BARDA as a medical countermeasure to treat smallpox. This extension provided an additional $13.0 million for a period of 15 months. The company received an initial award from BARDA in February 2011 to support early research and development of brincidofovir in animal models of smallpox and also received a contract extension of $17.0 million in September 2014. Thus far, BARDA has awarded Chimerix $63 million to Chimerix.

The estimated period of performance for a 60-month base ordering period is September 2015 through August 2020 for initial deliveries of brincidofovir to the U.S. Centers for Disease Control and Prevention's Strategic National Stockpile (CDC/SNS), according to the posted notice of intent. Options may be exercised at BARDA's discretion to achieve the potential delivery of a maximum of 1.7 million treatment courses. BARDA's total estimated dollar value for the 60-month base period contract is approximately $100 million. If all options are exercised by BARDA, the total dollar value is estimated to be approximately $435 million. Any award would be subject to negotiation and execution of a definitive agreement by the parties.

Animal Studies of Brincidofovir in Smallpox

On July 23, 2015 Chimerix announced that brincidofovir showed a survival benefit in a pivotal study of an animal model for smallpox. This pivotal study was conducted under the FDA's Animal Efficacy Rule, which allows for testing of investigational compounds in animal models to support a drug's effectiveness in diseases which for ethical reasons are not feasible to study in humans. The primary objective of this study was to assess the efficacy of immediate and delayed treatment with brincidofovir after clinical signs of disease compared with placebo in preventing mortality in rabbits infected with the lethal rabbit pox virus; this is a well-characterized model for smallpox in humans.

The brincidofovir doses used in this animal study were scaled to equivalent doses used in the phase 3 SUPPRESS and AdVise trials. The study met its primary endpoint. Rabbits treated with brincidofovir upon the first clinical sign of disease, and rabbits that received brincidofovir 24 or 48 hours after the first clinical sign of disease, demonstrated a statistically significant (p < 0.05) reduction in mortality compared to rabbits that received placebo.

Regulatory Action

Final results from this study, including data on the incidence and severity of clinical and laboratory events in each cohort, are expected by the fourth quarter of 2015 and will be submitted to an upcoming medical conference and to the FDA for discussions of next steps. Additional data may be required prior to a new drug application (NDA) submission for smallpox.

Brincidofovir Trials in Kidney Transplant Patients

CMV and BK Virus in Kidney Transplant Patients

CMV is a significant cause of morbidity in kidney transplant patients. It is a contributing factor that results in ten-year graft survival rates of lower than 50%.  An even more dangerous infection is caused by the BK virus as approximately one fifth of kidney transplant recipients have BK viremia in the first year post-transplant. BK viremia-associated disease results in graft loss in more than two thirds of infected patients.

Clinical Trials of Brincidofovir in Kidney Transplant Patients

Chimerix began enrollment in the SUSTAIN and SURPASS phase 3 trials of brincidofovir for the prevention of CMV in kidney transplant patients in the second half of 2015. The failure of the SUPPRESS trial has caused management to temporarily prevent enrolling more patients in these trials. However, patients already enrolled will continue in the trial in accordance with the trial protocol.

The GVHD issue which may have caused the problems in SUPPRESS are not an issue in these trials. In SUPPRESS, allogeneic stem cells were transplanted to the recipient and these transplanted cells can cause an immune response against the recipient’s cells. In SUSTAIN and SURPASS, only a donor’s kidney (not stem cells) is transplanted so that GVHD is not an issue. Steroids may be required to suppress the recipient’s immune system from attacking the kidney transplant. Importantly, to the extent that this steroid usage is a problem it will affect both the brincidofovir and valganciclovir control arm whereas in SUPPRESS only the brincidofovir arm was affected by high steroid use.

SUSTAIN Trial Design

SUSTAIN will compare brincidofovir to valganciclovir in the prevention of CMV reactivation; valganciclovir is approved in this indication. Patients in the study will be kidney transplant patients who have not been previously infected with CMV, these patients are referred to as R-. These patients will receive a kidney from a donor who has been infected with CMV; these patients are referred to as D+. The R- patients make up about 20% of the kidney transplant population and are at very high risk of CMV infection transmitted from the donated kidney.

The primary endpoint of the study is CMV disease at one year with secondary endpoints related to renal function at one year, a measurement closely correlated with long-term kidney graft survival. The trial is expected to enroll approximately 750 patients with 1:1 randomization to brincidofovir or valganciclovir following the transplant. The 100 mg twice-weekly dose of brincidofovir used in the SUPPRESS trial will be used.

SURPASS Trial Design

The great majority of kidney transplant recipients are CMV seropositive or R+. They are at increased risk of CMV reactivation due to the medicines they receive to suppress the immune system that are required to decrease the risk of rejecting the new kidney. The SURPASS trial will enroll R+ transplant recipients and will be conducted at the same clinical sites as SUSTAIN.

SURPASS is a blinded, non-inferiority study of brincidofovir versus valganciclovir in kidney transplant recipients who are R+. The primary endpoint is CMV disease at six months with secondary endpoints related to renal function, measurement s that closely correlate with long-term kidney graft survival. The trial is expected to enroll approximately 520 patients with 1:1 randomization to brincidofovir or valganciclovir. The dose of brincidofovir will be 100 mg twice-weekly as was used in SUPPRESS and is being used in SUSTAIN.

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  1. Hi Larry, I will keep an eye on Chimerix in case the stock goes much lower since it will take 2019 or later for the next phase 3 results. I have notice you have not written lately of NWBO in a while. I am curious on your overall view of the company and if you believe it is still a buy with stock price at $3 and needing to keep diluting.

  2. Thank you Larry for the email. I miss read that top line results should come in late 2016.


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