Ever since the early 1980s, we've known that KRAS proteins get the ball rolling when it's time for cells to proliferate. We've also known that aggressive tumors often contain a mutated KRAS gene that produces out-of-control versions of the protein.
Oncologists have believed a drug that shuts down overzealous mutant KRAS proteins would make a big difference for all kinds of cancer patients, but none have succeeded in human trials until recently. Amgen's (AMGN -0.12%) experimental cancer treatment, AMG 510, recently became the first KRAS inhibitor to produce positive results in a human proof-of-concept trial.
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Amgen's announcement also pushed up shares of companies developing similar new drug candidates. Mirati Therapeutics (MRTX), Array Biopharma (ARRY), and Gilead Sciences (GILD -0.29%) all rose a few percentage points following Amgen's announcement. Here's why the candidates they're developing could give these three stocks a big boost.
1. Mirati Therapeutics: Not far behind
Mirati started a human proof-of-concept study with its new lead candidate, called MRTX849, in January and shareholders can feel a lot more confident about it. That's because Mirati's experimental KRAS inhibitor has a lot in common with AMG 510, and the initial results suggest they're both on the right track. Among the first 10 evaluable lung cancer patients treated with AMG 510, four experienced tumor shrinkage and one even achieved a complete response.
Amgen's AMG 510, and Mirati's MRTX849 are both small-molecule drugs that aim for the same hard-to-reach target on overzealous KRAS proteins that have the same G12C mutation. We should get our first look at human proof-of-concept data for MRTX849 before the end of the year. Although AMG 510's positive early readout bodes well for Mirati's candidate, it also sets the bar awfully high.
2. Array Biopharma: Collaborator of the year
Array Biopharma has become the place where start-up biotechs go to develop ideas into easy-to-swallow small-molecule drugs. Researchers at Mirati Therapeutics knew they wanted to inhibit KRAS proteins from promoting tumor growth, and Array provided them with MRTX849. In return, Array's eligible to receive significant milestone payments and a tiered royalty percentage that tops out in the mid-teens.
Array Biopharma has enjoyed success with a wholly owned melanoma drug and a string of out-licensed molecules it's discovered for collaboration partners. Array's latest big win was with a highly selective small-molecule cancer drug that Bayer (BAYR.Y -0.57%) recently began marketing under the brand name Vitrakvi.
Eli Lilly (LLY -0.51%) spent a whopping $8 billion to acquire Vitrakvi's developer, Loxo Oncology. If Mirati's KRAS inhibitor reads out as more effective than Amgen's AMG 510, Array Biopharma can look forward to more collaborators beating a path to their laboratory or maybe even a juicy buyout offer of its own.
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3. Gilead Sciences: A shot worth taking
This biotech's known for antiviral treatments, but Gilead Sciences dove right into cancer drug development a couple of years ago with the $11.9 billion acquisition of Kite Pharma. Gilead wanted to get its hands on a chimeric antigen receptor-modified T-cell (CAR-T) therapy called Yescarta.
Yescarta and other CAR-T treatments involve removing a patient's own immune cells then training them to attack cancer cells with a protein called CD19 on their surface. Long before Gilead came along, Kite made a deal with the National Cancer Institute (NCI) to develop a similar treatment that specifically recognizes KRAS proteins with the G12D mutation. Once they find their target, the modified T-cells should facilitate a tumor-blasting immune system attack.
In April, the NCI began a government-sponsored human proof-of-concept study with 70 patients and a cellular therapy tentatively named anti-KRAS G12D mTCR-transduced PBL. The big danger here is the risk these modified T-cells might attack KRAS proteins in healthy cells, but it doesn't seem likely. We'll find out when the results read out in late 2027.
A favorite
Gilead doesn't seem terribly enthusiastic about its NCI-sponsored program right now, but further success for small-molecule KRAS inhibitors could inspire the biotech to pick up the pace. If you're looking for a great biotech stock to buy, Array Biopharma seems like a far better option than Gilead or Mirati right now.
Array narrowed its operating loss to $119 million over the past 12 months and rising sales of Braftovi, plus some royalty income from Bayer and other partners could allow Array to start breaking even before we know much more about MRTX849. The best thing about Array is that it can probably deliver long-term gains even if its partnered KRAS inhibitor doesn't meet expectations.
