What: Advaxis (NASDAQ: ADXS), a clinical-stage cancer immunotherapy company, saw its shares gain over 11% in October, according to data provided by S&P Capital IQ. Even so, the company didn't exactly have a good month. Advaxis kicked off the month by announcing that it received verbal notice from the FDA of a clinical hold on its lead experimental-stage product candidate, axalimogene filolisbac (ADXS-HPV), after a single patient with end-stage cervical cancer that had received the treatment back in 2013 passed away.
So what: Given the lack of positive news during the month, Advaxis' stock appears to have simply rallied along with the broader cancer immunotherapy space. That's not entirely surprising in light of the fact that these stocks have been getting crushed in the second half of 2015 and their dramatic downturn was probably a bit overdone.
Now what: According to an early November press release from Advaxis, the FDA is apparently in agreement with the company that the patient's death was due to the progression of her late-stage cervical cancer, and not necessarily the result of being treated with axalimogene filolisbac. However, the fact that these bioengineered bacteria remained in the patient's system for such a lengthy period of time appears to have led to the agency to request Advaxis to propose some risk mitigation measures that would be implemented once the clinical hold is lifted.
Presumably, these risk mitigation strategies would also cover Advaxis' collaborative work with AstraZeneca (NYSE: AZN) and Merck (NYSE: MRK). Advaxis and its collaborators are presently exploring the use of these bioengineered bacteria as part of a couple of cancer-fighting combo therapies. Specifically, Advaxis and AstraZeneca's subsidiary MedImmune are evaluating the safety and efficacy of the anti-PD-L1 immune checkpoint inhibitor, MEDI4736, in combination with axalimogene filolisbac as a treatment for patients with advanced, recurrent or refractory human papillomavirus associated cervical cancer and HPV-associated head and neck cancer.
Advaxis is also collaborating with Merck to test the combo of ADXS-PSA and the anti-PD1 inhibitor Keytruda in patients with previously treated, metastatic castration-resistant prostate cancer. Per the company's last update, these collaborative efforts with AstraZeneca and Merck should start to produce midstage data readouts starting in 2017 and stretching into 2019.
Although it is looking like the FDA will eventually release this clinical hold, I think investors may want to wait until this event actually happens and the details of any risk mitigation measures are known before jumping into this speculative biotech stock. After all, there's no way to know what the FDA is really thinking at this point, and the agency could end up throwing Advaxis an unexpected curve ball.
