Ziopharm Oncology, Inc. (NASDAQ:ZIOP) and Celldex Therapeutics, Inc. (NASDAQ:CLDX) are both clinical-stage biotechs that could make you rich, but they'll need to carry at least one of their new cancer drug candidates across the finish line first. Let's look at some of the opportunities in front of these companies, and challenges they'll face along the way, to see which one is the better stock to buy at the moment. 

The case for Ziopharm Oncology, Inc.

This stock popped in August when Gilead Sciences offered $11.9 billion to Kite Pharma, which is another clinical-stage biotech developing CAR-T therapies. Kite's lead candidate, axi-cel, is basically an infusion of a patient's own immune cells trained to hunt for cancer cells that display the CD19 protein on their surface. 

A woman with her hand on her chin in front of two arrows pointing in opposite directions.

Image source: Getty Images.

 Ziopharm claims its own CD19 directed cells can be ready to go just two days after they're withdrawn, which would give it a big edge over the competition. Kite has whittled axi-cel's manufacturing process down to about 17 days from the time patient cells are removed until they're ready to be reinfused. Kymriah from Novartis was quick to earn the first Food and Drug Administration approval for this treatment class, but its turnaround time is about 22 days.

Investors getting excited about Ziopharm's speedy CAR-T candidates need to understand that there isn't a lot of data. At the moment, MD Anderson Cancer Center is enrolling patients in a phase 1 trial with an earlier generation of Ziopharm's CD19 directed therapy that takes a couple of weeks to manufacture. So far, one patient with an aggressive form of lymphoma achieved a complete remission lasting approximately six months, but the company hasn't even started dosing patients with a version created in under two days.

The company's most advanced candidate is a complicated combination that has produced interesting results for patients with recurrent glioblastoma, an aggressive form of brain cancer with few treatment options. Investigators inject ad-RTS-hIL-12 directly into brain tumors then give patients veledimex pills in order to control the expression of interleukin-12 (IL-12), a protein that stimulates anti-cancer immune responses.

Median overall survival among 15 patients treated with Ziopharm's IL-12 candidate and given 20 mg of veledimex reached 12.5 months. Historically, patients meeting this group's criteria would reach median overall survival of six to seven months. Investors should know that historical survival data isn't the best predictor of success in subsequent studies with control groups, especially with brain cancer.

Sadly, it looks like Ziopharm isn't in a hurry to find out if its lead candidate can actually outperform anything. The company announced a successful conclusion to its end of phase 2 meeting with the FDA in March but hasn't even announced a protocol for an upcoming pivotal trial yet.

A female doctor consulting with a male patient in a hospital bed.

Image source: Getty Images.

The case for Celldex Therapeutics, Inc.

This biotech probably understands Ziopharm's current situation better than most. The stock imploded last year after brain cancer patients in the first control group tested against its former lead candidate outperformed historical survival data by a wide margin.

When Rintega failed spectacularly, Celldex was lucky enough to have another candidate ready for a pivotal trial. The company's new lead candidate, glemba, is a far more conventional drug that delivers fun-sized chemo bombs directly to cancer cells that have a protein called gpNMB on their surface.

Glemba's gpNMB target is overexpressed in the tumors of roughly half of all breast cancer patients who also lack three important targets that current treatments aim for. Progression-free survival among a small group of triple-negative patients treated with glemba was more than twice as long as the group receiving standard chemo drugs, but these results were extrapolated from a much larger study.

Investors have been driving up shares of Celldex in anticipation of results from an ongoing 327-patient pivotal trial that will determine glemba's fate. If the results fall in line with previous observations, the stock will soar.

Should glemba lead to another shocking upset, though, the company could fall back yet again on a growing stable of novel oncology candidates in clinical-stage clinical development. Varlilumab is in mid-stage combination studies with glemba and Opdivo, plus it four additional candidates are in a handful of clinical trials, some of which are independently sponsored.

Running the numbers

Novartis' Kymriah is expected to generate about $2 billion in sales each year at its peak, and it stands to reason a more convenient CD19 directed CAR-T therapy could do as well, if not better. Unfortunately, we just don't have enough data for Ziopharm's CD19 program, or any of its CAR-T candidates to assume more than a fleeting chance of eventual approval.

Single-arm results suggest Ziopharm's IL-12 directed combination has potential to generate more than $1 billion in peak annual sales as the first improvement for underserved brain cancer patients in years. Until we have some evidence it can outperform standard chemotherapy, however, Ziopharm stock seems awfully expensive at a recent enterprise value of $825 million. 

Celldex, on the other hand, sports a sprightly $240 million enterprise value which is even less than the $400 million in annual sales glemba is expected to generate at its peak each year if approved for the treatment of triple-negative breast cancer patients alone. Remember, the candidate already has data pointing to a significant survival benefit in this group, and a pivotal trial is well underway.

Glemba might be heading toward a smaller prize, but its chances of success are much higher than any Zioppharm program. That makes Celldex the better stock to buy right now.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.