HONG KONG – A Chinese biotech company has plans to further explore the potential of immuno-oncology products through a licensing deal with a U.S. pharma company dedicated to oncology. The push could put Lee's Pharmaceutical Holdings as a leader in that particular class of drugs in China, a class that has enormous potential.

Lee's, through affiliate China Oncology Focus Ltd., inked a licensing agreement with San Diego-based Sorrento Therapeutics Inc. to take up the development of Sorrento's fully human anti-PD-L1 monoclonal antibody (mAb), STI-A1014, in the Greater China region.

"Lee's commitment to addressing high unmet oncology needs by bringing new effective immuno-oncology therapies to the Chinese market is reflected in this transaction," said Benjamin Li, Lee's CEO and executive director. "We expect to start a phase I clinical trial of the anti-PD-L1 antibody in China in 2015."

The programmed death 1 (PD-1) inhibitory receptor is expressed by T cells that play a central role in cell-mediated immunity. The ligation with its ligands, PD-L1 and PD-L2, results in negative regulation of T-cell activity. Using antibodies to block that process helps with T cells' specificity for cancer.

"This is a new class of drug that China is still waiting for a first approval," Li told BioWorld Asia. "However, given the high prevalence of cancers in China, the market potential for this class of drugs will be enormous. As a class, it could reach ¥10 [billion] to 20 billion" (US$1.6 billion to $3.3 billion).

"Lee's will develop the product independently in China," Li said. "We envisage a four-year development timeline."

Sorrento will receive as much as $46 million from Lee's in up-front payments, potential future milestone payments and royalties on future sales. Under the terms of the agreement, Lee's will be responsible for the development and commercialization of STI-A1014 in the Greater China region, including Mainland China, Hong Kong, Macau and Taiwan. Lee's also will make a $3.6 million investment in Sorrento by purchasing common stock at a substantial premium to the current market price.

"This partnership further validates our G-MAB antibody technology and underscores Sorrento's commitment for seeking strategic alliances in bringing its diverse portfolio of fully human monoclonal antibodies, antibody-drug conjugates and bispecific antibodies into the clinic," said Henry Ji, president and CEO of Sorrento.

Immuno-oncology has emerged as the new hot topic in the global pharmaceutical market. Antibodies designed to hit targets such as cytotoxic T-lymphocyte-associated protein 4 (CTLA-4), a protein receptor that down-regulates the immune system, or the PD-1 and PD-L1 targets that harness cancer patients' own immune system to fight against cancer have shown exceptional performances compared with conventional cancer drugs. Citigroup has predicted that this category could be the biggest blockbuster drug class in history, with potential sales of $35 billion a year over the next decade.

"This is the most exciting topic in oncology today. This class of drug is also called checkpoint inhibitor, unlocking patient's immune system to fight cancer," Li explained. "[There have been] many clinical studies on [a] variety of cancers such as lung cancer, bladder cancer, etc. with very promising results . . . To say it is a revolution for the oncology field is an understatement."

Regulators in the U.S. and Japan approved the first immuno-oncology products, Merck & Co Inc.'s Keytruda (pembrolizumab) in September and Bristol-Myers Squibb Co.'s Opdivo (nivolumab) in July, respectively, for the treatment of patients with unresectable melanoma. (See BioWorld Today, July 9, 2014, and Sept. 5, 2014.)

The promise of that category of drug is attracting attention from more and more companies from around Asia.

At the end of last month, Japanese biotech company Kyowa Hakko Kirin Co. Ltd. and New York-based Pfizer Inc. entered an agreement to study the combination of their drugs, mogamulizumab from Kyowa Hakko Kirin and PF-05082566 from Pfizer, for a potential immuno-oncology treatment for solid tumors. (See BioWorld Today, Oct. 1, 2014.)

"The main reason why many companies are focusing on immuno-oncology therapy is the expectation of the survival advantage," said Kazuaki Inoue, manager at corporate communications department at Kyowa Hakko Kirin. "Target therapy shows temporal tumor shrinkage and extension of the progression of pathogenesis."

In July, Kyowa Hakko Kirin entered a clinical collaboration with Astrazeneca plc. The phase I/Ib study also involves mogamulizumab and Astrazeneca's anti-PD-L1 antibody, MEDI4736.