Glioblastoma is the most invasive and malignant type of brain cancer. If untreated, patients survive for a medial duration of merely three to four months from the initial development of tumors. The condition affects more than 27,000 adults in North America annually.

Since 2015, Novocure (NVCR -0.75%) has commercialized a medical device called Tumor Treating Fields (TTF) which can significantly prolong the survival rates of patients when combined with other standards of care. Sales of the product have amounted to more than nine figures last year, and may skyrocket to new levels as the company begins to investigate the medical device for expanded use against other types of cancer. Let's examine the company's growth catalysts below. 



What is Tumor Treating Fields (TTF)?

TTF (brand name Optune) is a device invented by Novocure that applies a field of alternating electrical currents to cancer cells in the patient's brain. Once targeted, charged proteins in cancer cells will experience movement disruptions due to the presence of electrostatic force, and will not be able to instruct the cell to reproduce normally. 

In its clinical trials, glioblastoma patients treated with a combination of chemotherapy and TTF after radiotherapy and surgery had a median overall survival (most frequently occurring survival time) of 20.53 months, compared to 15.57 months for those treated only with chemotherapy after standard procedures. The difference was highly statistically significant, and the product was rushed to approval after an interim analysis to help save lives. There were no serious adverse events resulting from the use of the device. 

What are the new opportunities?

Currently, the device has treated over 14,000 patients and it costs more than $20,000 per month. Fortunately, it is covered by Medicare and has a minimum treatment duration of 4 weeks for tumor stabilization. Last year, it generated over $350 million in revenue.

Moreover, Optune is currently undergoing phase 3 clinical trials for four conditions; brain metastases, lung carcinoma, pancreatic cancer, and ovarian cancer. Final data from these investigations will be released between 2022 and 2025 (due to delays from COVID-19), and so far, the results have been promising.   

In all phase 1/2 clinical trials evaluating Optune for treating lung carcinoma, pancreatic cancer, and ovarian cancer, patients' survival in the treatment cohort was significantly better than that of historical control groups. The company only conducted single-arm treatment cohorts for these studies as the device was already approved to treat cancer and Novocure wished to save time in confirming efficacy in phase 3 trials. In the case of patients treated with Optune for pancreatic cancer, the median overall survival time was 14.9 months versus historical rates of 6.7 months, representing a massive 122% survival benefit. 

But wait a minute...

At this point, avid biotech investors may object to the potential of Optune in other fields of cancer treatments, as none of the clinical trials discussed above were conducted with placebo arms. Fair enough. However, there is just one problem with this counterargument.

Optune is currently the best adjunct therapy available for treating glioblastoma and was recently approved to treat mesothelioma. In other words, we already know the device works and is able to kill even the most malignant of cancer cells in the brain, which is the most difficult area of the body for chemotherapy drugs to enter due to the presence of the blood-brain barrier (which prevents pharmaceutical solutes in the blood from entering the brain). Hence, it is likely Optune's results will be scientifically replicable in other oncological fields. 

Considering the market for treating pancreatic cancer alone is projected to grow to over $4 billion by 2025, significant opportunities lies ahead should Optune witness clinical success in these investigations. 

Actionable takeaways

Since the mechanism of action for Optune is well-known and its efficacy results are well-supported, investors may wish to open a stake now in anticipation of likely success of the device in treating other cancer fields. While the company is devoting nearly all of its profits into research & development, it has over $300 million in cash on hand for unexpected expenses, which will prevent the dilution of shareholders.

Importantly, the stock is down 16% year to date, as a result of the COVID-19 pandemic, but this should pose a buying opportunity for this high-growth biotech company. If disruptions in its clinical trials are resolved quickly, the company should be back on track to release results for Optune's expanded use cancer trials by 2022. For long-term investors, this does not represent too long of a wait at all.