Shares of Agenus (AGEN 0.63%) dropped more than 32% this morning after the company gave investors bad news regarding its experimental cancer immunotherapy balstilimab. The company has withdrawn the Biologics License Application (BLA) that the Food and Drug Administration (FDA) began reviewing earlier this year. The biotech stock was down 25.3% as of 11:40 a.m. EDT on Friday.
Agenus has a large pipeline of experimental drugs, but it doesn't have the cash flows required to develop them at a pace that satisfies investors. The company was gunning for accelerated approval of balstilimab, an anti-PD1 candidate, as a treatment for second-line cervical cancer.
Unfortunately for Agenus, the FDA granted full approval to another anti-PD1 drug, Keytruda from Merck (MRK 1.43%), before it got around to issuing accelerated approval of balstilimab. Agenus has good tumor-shrinkage data from an open-label study. In June, we learned that Keytruda significantly improved overall survival in a larger, longer confirmatory trial with similar patients.
Agenus will discontinue a confirmatory trial for balstilimab as monotherapy for cervical cancer, but the company isn't throwing in the towel yet. Agenus intends to continue developing its anti-PD1 candidate as part of combination treatments.
Discontinuing balstilimab's confirmatory trial is expected to lower operating costs by over $100 million. Agenus finished June with just $73 million in cash after burning through $138 million in the first half of 2021. The company received a $200 million cash injection in July thanks to a licensing deal with Bristol Myers Squibb (BMY 1.51%). With fewer balstilimab expenses, this could be enough to see the company through 2022.