Follow Us GraphicFacebook IconTwitter IconLinkedIn Icon
Search Graphic

Expert Financial Analysis and Reporting

Northwest Biotehrpeutics: How Does DCVax-L Clinical Data Compare to the CAR-T Therapy Axi-Cel? (NWBO, $0.18, Buy)

New Seeking Alpha Article on Seeking Alpha

An article on Seeking Alpha called Northwest Biotherapeutics: Statistically Satisfying was just published by an author who uses the pseudonym Bohsie. He looks at the unblinded data from the phase 3 trial of DCVax-L and hypothesizes that the data seems highly supportive of the hope that the phase 3 trial of DCVax-L will be statistically significant on the primary endpoint of PFS. The article is balanced, insightful and well-reasoned, but as is always the case, writers from hedge funds have viciously attacked the article. The common thread of their comments seems to be that the trial will fail because the stock price is $0.18. None of the numerous posts attacking Bohsie tried to refute his analysis. They just attacked him personally. This is a standard tactic of hedge fund shills.

Hedge Funds Disparage the Article

Hedge funds have been heavily involved on the long side with KITE and for some time I have thought about comparing the phase 2 results for KITE’s CAR-T therapy Axi-Cel versus phase 1/2 results for DCVax-L. I finally did this in response to one of the hedge fund writers Biotech Hawk. This author (probably a consortium of hedge fund personnel) published four highly negative articles on NWBO from July to October of 2014 and then disappeared only to reappear and make comments on Bohsie’s Seeking Alpha article. The four articles were done at a time when there was a widespread short selling attack on NWBO. Anyone want to guess which hedge fund he works for? Anyway, Biotech Hawk in attacking Bohsie praised the data from Kite’s CAR-T drug Axi-Cel. His  comments personally atttcked Bohsie without any attempt to refute the article with meaningful data. Two of his comments are shown below

Comment 1 from Biotech Hawk:

You assume that NWBO is publishing correct information. They have a history of manipulating or misrepresenting data in the past.
You assume NWBO management is competent in running or analyzing clinical trials.
You assume that the PFS data released are accurate. PFS is a subjective measure and it is not clear if NWBO is doing independent analyses of progression, their own interpretation, or using investigator judgement.

You assume that the 83 patients are not just lost data (e.g. patients that had disease progression years ago, but the data has not been entered in the database).

Why, oh why, has it taken more than 6 months to release the results of the trial. The study primary endpoint is at 248 PFS events. That was reached in February. In 20+ years of running clinical trials, I have never seen an analysis take so long.
I once had a short position in this stock and exited that position almost 2 years ago. I have no dog in this fight, except that it pisses me off to see obvious frauds still in existence giving people false hope.

After writing negative articles about NWBO several years ago, I received several emails from thankful people who sold out of the stock. Take my advice for what it's worth. Save yourself the last 20 cents / share

Comment 2 from Biotech Hawk:

KITE filed a BLA a few months ago and is likely (though not guaranteed) to have a product FDA approved by the end of this year. Their pivotal trial took 2.5 years to complete. Because they are competent and their product works. I am sure that if data were positive, NWBO would have wasted no time to PR the results soon after the trial met its endpoint in February.

My Response to Biotech Hawk

I have pointed out in numerous past articles that it is a paradox that people can look at the Kite phase 2 data on Axi-Cel and pronounce it as stunning as does Biotech Hawk and in the next breath dismiss phase 1/2 data on DCVax-L that appears much more encouraging. Biotech Hawk’s provocative nonsensical comments caused me to take pen in hand and respond to him in the Seeking Alpha article. I thought I would reproduce this comment for my subscribers.

KITE's ZUMA-1 trial was an open label phase 2 trial of Axi-Cel that evaluated 71 patients with r.r DLBCL and 41 patients with r/r PMBCL and TFL. The r/r DLBCL results are most important since in an addressable market of about 7,500 patients r/r DLBCL patients comprise over 6,800. Also r/r DLBCL patients do less well than r/r PMBCL and tFL patients in whom results are meaningfully better.

Let's focus on the r/r DLBCL results. At six months, there were 33% of patients who had a CR that was maintained. There is no data on survival. Will a CR translate into long term survival? We don't know. Shrinking tumors is suggestive of improving survival outcomes, but very far from definitive.  Results in pediatric r/r ALL suggest that CRs translate into long term survival, but we don't know about r/r DLBCL. There is no data.

Biotech Hawk enthusiastically endorses the ZUMA-1 results, but disparage the extremely positive results of the phase 1/2 trial of 20 newly diagnosed GBM patients treated by Linda Liau at UCLA. In those 20 patients median OS was 3 years, median PFS was 2 years and 33% of patients were alive at 4 years, 27% at six years and 2 patients have survived for more than 12 years. Well controlled clinical trials have shown that 10% or so of newly diagnosed GBM patients treated with SOC are alive at three years.

I would have to say that the average new investor from Mars would without question, consider the DCVax-L phase 1/2 results extremely promising and the Axi-Cel results as interesting, but needing to mature. They might also wonder about pricing Axi-Cel at $500,000+ per treatment when only one-third or less may benefit. By the way, about 30% to 40% of Axi-Cel treated patients suffer grade 3 or 4 side effects while the side effects of DCVax-L are a headache and fever that can be treted with Tylenol.

Perhaps some of the brilliant mathematicians and biostatisticians who work for hedge funds can explain why the Axi-Cell results should be considered as superior as you maintain. My Martian friends and I are baffled by your claim that Axi-Cel phase 2 data as we now know it is so superior to the phase 1/2 DCVax-L. Oh I forgot, the data reported by Linda Liau is fraudulent and she and the UCLA neurology department are engaged in a conspiracy with NWBO to defraud investors. Linda Liau has reported that she does not own any shares of NWBO so her motives for engaging in stock manipulation as you maintain are difficult to ascertain.

I think that CAR-T therapy is a significant advance in oncology, but at this point all of the survival data is anecdotal from NIH and UPENN and there is absolutely no data from controlled trials.

I for one think that unblinded data on the controlled phase 3, DCVax-L trial of 331 patients is extremely encouraging as patients are undoubtedly living longer than would be expected with SOC. Of d course, no one clearly knows what is going on until the trial is unblinded. I have written a report on this on my website, which I encourage all to look at. Whereas Bohsie focuses on PFS, my focus is on OS. Here is the link.

Tagged as , + Categorized as Company Reports, LinkedIn


  1. The timing of this article is ironic, coming just before Gilead’s $12b takeover of Kite. As someone who was long GILD and short KITE, I was doubly surprised. As Larry has pointed out, Axi-Cel will compete directly (without differentiation) against a Novartis product in a market with many more competitors to come. That part sounds like the Hep-C market. Add in possible insurance foot-dragging due to an extremely expensive treatment plan with no medium/long-term supporting data and I wonder what Gilead is thinking. My first thought is that GILD must really like KITE’s pipeline. Second thought is that Alessandro Riva, Gilead’s head of hematology and oncology came from Novartis, and presumably brings with him great expertise, and seemingly, great optimism about the potential of CAR-T.

    Still, it leaves me shaking my head. Is the market really so inefficient that KITE can be worth $12b while NWBO, with better study results, is worth less than $100m? Obviously, the first response to such a statement is that the markets are different. However, based in-part on what Larry has written, I think a near-term product in the Glioblastoma market complemented by an earlier stage product with potential against all solid tumors is more attractive than a near-term me-to product for r/r DLBCL complemented by earlier stage products with potential against blood-related cancers.

    Can anyone name other products that emerged from as deep an economic hole as NWBO to become commercial successes? Anyone have ideas on how I could research this question?

  2. I am utterly bewildered by this acquisition given the limited amount of data on Axi-Cel (there is no survival data yet, just objective repsonse data), the market addressed by CAR-T may be limited to hematological cancers only, the price of therapy is indicated as over $500,000 but only 33% of r/r DLBCL patients have a comlpete response, Novartis will likley be head to head with Axi-Cel in all indications, there are over 30 CAR-T companies working on drug development so that Kite could be superceded etc. I just don’t see how GILD could pay this amount of money for an undifferentiated product in a what could be a highly competitve market.

    The one takeaway I take from this is that GILD has now endorsed autologous cell therapy. Big bipharma companies are rosk adverse on embracing new technologies. Prime examples are recombinant DNA and monoclonal antibodies. Big pharma stuck to small molecules, but later jumped with both feet. It is definitely monkey see, monkey do with the big guys and they have now seen a monkey do autologous cell therapy. I think the implications for NWBO are enormous if the DCVax-L phase 3 trial is successful. The addressable market for newly diagnosed GBM is about twice the size of the r/r DLBCL market at about 15,000 patients. There is no competive product to DCVax-L and its side effects are benign. If it is the case that DCVax-L phase 3 trial shows convincing evidence of efficacy and appears destined for approval, it should warrant a multi-billion price tag from a big pharma acquiror. How about GILD being the acquiror? There seems more than a reasonable chance for this to occur as lead investigators on the trial have pointed out that they are very encouraged that patients in the trial are living longer than expected, the phase 1/2 results were exellent and data from the information arm of the phase 3 was very encouraging. This has the potential to be one of the most amazing reversals of consensus opinion in the history of biotech. True, if the phase 3 trial failes miserably, NWBO will likely go bankrupt. However, if acquired at 25% of the KITE vakuation, the upside would be $15.

    In answer to your last paragraph question there are two good exapmles. Pharmacyclics came back from the dead based on the development of Imbruvica as did Jazz based on dramatic price increases for Xyrem. Both stocks at their lows were selling for pennies and went on to reach stock prices of $150+.

  3. Larry, thanks for responding, and also for sharing your bewilderment. I saw your comment to the seeking alpha article on NWBO where you recommended “Black Edge” written by Elan Kolkalkar, I immediately purchased the book.

  4. Larry, what are your thoughts on the close relationship between Nortwest Bio and Cognat as a complication in a potential buy out of NWBO?

  5. The use of contract manufacturers like Cognate is common in biopharma. For example, Pototal is using contract manufacturers for Bevyxxa and AndexXa. This would not a factor in any decsion to acquire NWBO . The whole issue with Cognate is nonsense and was contrived by the wolfpack as part of their attack on the company. Had Cognate not been willing to accept NWBO stock in lieu of cash, the phase 3 trial could not have been completed. The value of that stock has declined sharply since issuance and Cognate retains over 95% of this stock.


You must be logged in, or you must subscribe to post a comment.