Expert Financial Analysis and Reporting

Overview

Northwest Biotherapeutics told investors that it would discuss initial results of the phase 1/2 trial of DCVax-Direct in inoperable solid tumors including metastatic colon, pancreatic, sarcoma, melanoma and others prior to ASCO. This morning they issued a press release summarizing early results and I understand that management will host a conference call this afternoon, Tuesday, May 27 at 4:15 PM, to discuss the results in more detail. There are a number of questions that will doubtlessly be addressed on the call this afternoon. This note gives my initial reaction to the press release.

Characteristics of Patients Enrolled in the Trial

In the treatment of most solid tumors, the first treatment is surgical resection of the tumor to remove as much of the primary tumor mass as possible. This is then followed by chemotherapy and radiation to further reduce the size of the tumor and its metastases. This trial is being conducted in patients with inoperable tumors due either to the location of the tumor or because the tumor has metastasized to the extent that surgery would not be of benefit.

The patient group in which DCVax Direct is being tested has very advanced disease. There is no therapy approved in this setting although patients may still be given chemotherapy and radiation in an effort to do something. There is obviously an urgent and unmet medical need for therapy for these patients. Again, the key point to consider is that because their tumors cannot be resected, the tumor is usually large and growing at time of treatment. These are very difficult to treat patients. If DCVax Direct is ultimately approved, its primary use will be in less severely ill, surgically resected patients who would be expected to respond better.

Description of Trial

DCVax Direct is injected into one tumor site which does not necessarily have to be on the exterior of the body. Imaging technology can allow the injection to be delivered to interior tumor masses. The initial phase 1 portion of the trial involves 36 patients. The treatment regimen includes a total of six treatments given at day 0, day 7, day 14 and week 8, week 16 and week 32. The repeated vaccinations are intended to create and build over time an immune response against the tumor.

The Company indicated that in the early stages of the trial that the protocol required that each patient treated would receive two injections. Then the investigators would have to wait 2 to 3 weeks before enrolling the next patient. This is a typical safety precaution in a first in human trial. This initially slowed enrollment but in March those restrictions were lifted and the remainder of the 36 patients have either been enrolled or have completed screening. Enrollment occurs after screening and manufacturing have been completed.

A Look at Early Results

Because this is an open label trial with no control group, NWBO can report results as they occur and then update them periodically. This is a common practice in a phase 1 trial. The phase 1 portion of the trial includes 36 patients. Of these, 19 have completed at least half of the 6 treatments, but none have completed all six vaccinations. NWBO indicates that of these 19 patients 11 or 58% have shown a preliminary response to treatment, 7 patients have progressed and 1 patient can’t be evaluated. The last patient should complete the trial in early 2015.

The response for immune therapies based on the experience we have seen with the two approved immunotherapies, Yervoy and Provenge, is different than older therapies. Chemotherapies when effective will quickly shrink the tumor and their efficacy is based on the degree to which the tumor shrinks. This ranges from a complete response in which the tumor is not detectable (other than scar tissue) to a partial response in which half or more of the tumor disappears or to stabile disease in which the cancer no longer grows. A complete or partial response is generally deemed a success for chemotherapy and stabile disease is sometimes looked at as a positive outcome in treatment.

Judging the response of immune therapies is somewhat different from chemotherapy. In addition to looking for tumor shrinkage, effectiveness is also judged by the degree to which the immune system can be activated to attack the tumor. Investigators want to see immune cells infiltrating or flocking to the tumor and signs of tumor cell death. In some patients in the case of Yervoy and Provenge, the size of the tumor actually increased initially due to the accumulation of dead (necrosed tissue) and the inflammatory reaction caused by the immune cells attacking the tumor. Hence, shrinkage of the tumor while important and the primary goal may not be seen early in immunotherapy.

The early results as reported by NWBO on the 11 of 19 patients treated that showed an early response were as follows:

• 8 of 11 patients have shown signs of tumor necrosis (cell death), immune cell infiltration into the tumor and stabile disease. Biopsies showed substantial or extensive tumor necrosis, as well as substantial accumulation of immune cells in and around the tumors.
• 6 of these 8 patients showed tumor shrinkage or no disease progression based on imaging studies.
• The other 2 of 8 patients showed enlargement of their tumor but the tumors based on biopsies had substantial necrosis and substantial infiltration of immune cells.
• In addition to these 8 patients, there were 3 other patients that showed stabile disease but with no evidence of tumor necrosis or infiltration of immune cells.

In judging these results, we have to take into account that the results are early as none of the patients have completed therapy that calls for six injections over 32 weeks or 8 months. The data indicates a meaningful initial effect on 11 of those 19 patients who have received at least three injections over a two week period. What will be extremely important is whether these effects are temporary or will they hold or improve over time. Generally, immune therapies produce results more slowly with an improving response over time so that I would hope that there would be improvement with time.

The data based on imaging and biopsies offers strong evidence that immune cells are being attracted to the tumor in some patients. This is the goal of cancer vaccines. The death of tumor tissue further indicates that these immune cells are attacking the tumor. There seems to be a very strong indication of biological activity in the 11 (58%) of 19 patients who have received three injections or two weeks of treatment. It is interesting to me that these effects are being manifested so early in treatment. These results are very encouraging, but early.