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Can NewLink Genetics Win the Zika Vaccine Race?

By Cory Renauer - Feb 8, 2016 at 10:06AM

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Does NewLink's success with Ebola suggest it can do the same with Zika?

Image source: Wikimedia Commons.

It seems the only thing spreading as fast as the Zika virus is the desire to develop a vaccine to prevent it. Recently, NewLink Genetics (NLNK) threw its hat into the ring along with GlaxoSmithKline (GSK -0.04%)Sanofi (SNY -0.48%), and Inovio (INO -1.97%).

Adults infected with Zika virus rarely require hospitalization, but its strong association with adverse pregnancy outcomes has public health authorities on edge. A causal link between pregnant mothers infected with Zika virus and microcephaly -- a condition characterized by abnormally small heads at birth -- seems likely, but is not yet confirmed.

Demand for a vaccine to prevent Zika infection is already sky-high. If a connection to microcephaly is confirmed, that demand will rise even further.

Bragging rights?
NewLink Genetics is known throughout the biotech industry for its clinical stage immuno-oncology programs. Founded in 2005, its infectious disease subsidiary, BioProtection Systems, was relatively unknown until late 2014, when it entered into a partnership with Merck & Co. to develop an Ebola vaccine.

Last summer, the vaccine showed impressive clinical results that suggest it's 100% effective.  This might imply NewLink has what it takes to combat international viral crises, but it's important to point out that the ebola vaccine wasn't discovered internally. Rather, NewLink licensed it from the Public Health Agency of Canada.

Image source: NewLink Genetics.

There's nothing wrong with licensing compounds discovered elsewhere. Recognizing early stage candidates with potential, then unleashing their value by ushering them through the development process, is what makes the biotech world go round. However, NewLink's lack of clinical stage, infectious disease vaccines -- other than the ebola vaccine it passed from the PHAC to Merck -- doesn't fill me with confidence in its ability to quickly develop a successful Zika vaccine.

NewLink has had clinical success with vaccines directed at tumors. The company's lead candidate algenpantucel-L is currently in two phase 3 pancreatic cancer trials. The HyperAcute Cellular technology that algenpantucel-L is based on has been tested on influenza viruses, but only in animal models. 

I would assume the company would use its platform to develop a Zika virus, but whether that's the case is unclear. When NewLink announced its commitment to "developing a vaccine solution to the tragedy of the Zika virus disease," the platform to be employed wasn't mentioned.

The competition
In fact, if I were to rank NewLink, GlaxoSmithKline, Inovio, and Sanofi in order of their chances of winning the Zika-vaccine race, NewLink would be in last place. Further ahead would be Inovio for two reasons. First, Inovio's infectious disease-vaccine segment is far more robust than NewLink's, with several candidates in clinical trials.

Second, and more importantly, through a partnership with Korea's GeneOne Life Science, Inovio already has a Zika candidate undergoing animal studies. Even though the vast majority of drugs in animal studies never earn a chance to be tested on humans, Inovio has an edge here over NewLink, which doesn't even have a preclinical Zika candidate to speak of.

Alongside of Inovio in the rankings would be GlaxoSmithKline. Following its acquisition of Novartis' global vaccine business, it is arguably the world leader in prevention of infectious disease. Unlike Inovio, it doesn't have a Zika candidate, yet. Last month, the company was concluding feasibility studies to see if any of its vaccine-technology platforms might be suitable for Zika.

The front runner
Despite Glaxo's vast portfolio and pipeline it has no product or candidate to combat mosquito-borne flaviviruses, a group that includes Zika.

Image source: Sanofi.

At this point, if I had to predict a winner in the race to develop a Zika virus, I'd bet on Sanofi. The company already markets vaccines to protect against flaviviruses such as Japanese encephalitis and yellow fever. More recently, its dengue vaccine Dengvaxia won marketing approval in Mexico and the Philippines.

Inovio may be one step ahead with a preclinical candidate, where the others have none. That said, Sanofi's success with flaviviruses, and vast financial resources, should be enough to leapfrog Inovio, and eventually win the race to develop a Zika vaccine.

That being said, NewLink's immuno-oncology programs are well worth a closer look by potential investors. Roche was so impressed with NLG919 that it paid $150 million upfront -- plus potential milestones and royalties -- for rights to the checkpoint inhibitor. However, if you're considering an investment in NewLink based on the idea that its success with Ebola somehow points to potential in Zika, you'll probably be disappointed.

Cory Renauer has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Stocks Mentioned

NewLink Genetics Corporation Stock Quote
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