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Monday, June 6, 2016

Target Validation Enhances Potential For Pieris’ Inhaled Asthma Drug

Pieris Pharmaceuticals (NASDAQ: PIRS) is a biopharmaceutical company developing a novel class of drugs called Anticalins®, which are similar to monoclonal antibodies (mAbs) in that they are target-specific binding proteins, but have a number of differentiating characteristics that potentially make them superior to mAbs, such as novel routes of administration including inhalation. Below is a brief review of Pieris and the company’s Anticalin® platform. For purposes of this article, I focus on PRS-060, an Anticalin® that the company is developing as an inhaled treatment for asthma.

An Introduction To Anticalins®

Anticalins® are derived from lipocalins, which are naturally occurring, non-immunogenic, human proteins that bind to a variety of different molecules, including small hydrophobic molecules, peptides, and other proteins (1). Just as different mAbs bind to different antigens, so too do different lipocalins bind to different molecules. And similarly to mAbs, the specificity of binding can be manipulated in the laboratory to make an Anticalin® bind to any desired target without disrupting structural integrity. The following graphic shows the similarities and important advantages that Anticalins® have over mAbs. I’ve highlighted the ability to dose through inhalation, which is particularly relevant to PRS-060.

Pieris’ three fully proprietary lead products are PRS-080, an Anticalin® that binds to hepcidin and is being developed as a treatment for anemia due to chronic kidney disease, PRS-060, an Anticalin® that binds to the Interleukin-4 receptor alpha subunit (IL-4Rα) and is being developed as a treatment for asthma, and an immuno-oncology bispecific, PRS-343 (CD137/HER2).

PRS-060 is a good example of one of the distinguishing characteristics of Anticalins®. The drug can be locally delivered to the lungs via inhalation, thus potentially increasing the targeted effect, while offering some other potential advantages including convenience, lower amount of drug, lower costs to produce, and avoiding potential systemic side effects. Pieris is developing PRS-060 for the treatment of asthma through binding of IL-4Rα, a target that has now been validated by results from two clinical trials with dupilumab. PRS-060 is engineered from human lipocalin-1, a protein that is physiologically present in high concentrations in human lung lining fluid and human tears.

Brief Background on Asthma

Asthma is a heterogeneous disease with many different subtypes and clinical phenotypes (2). The disease is characterized by shortness of breath, coughing, and chest tightness. According to the U.S. Centers for Disease Control and Prevention (CDC), approximately 8.6% of children and 7.4% of adults in the U.S. have asthma. This equates to approximately 24 million individuals, an estimated 20% of patients are not adequately responsive to existing medications (3). The Global Initiative for Asthma (GINA) estimates that approximately 300 million individuals are affected by asthma worldwide.

The two basic subtypes of asthma are allergic, which typically begins in childhood, and non-allergic, which usually begins in adults. Allergic asthma is well characterized and known to involve various components of the immune system, in particular, Type 2 (or T2) immunity that involves Th2 lymphocyte cells, mast cells, and eosinophils. Th2/T2-driven inflammatory processes are present in approximately 50% of those with asthma. T2 immunity is also associated with distinct clinical biomarkers such as fractional exhaled nitric oxide (FeNO), which is the concentration of exhaled NO. T2 responses typically result in an increase in NO formation, and importantly this can be used during clinical testing as a biomarker to test for therapeutic efficacy, as effective treatments will cause a decrease in FeNO.

For treating asthma, most physicians in the U.S. follow the “Guidelines for the Diagnosis and Management of Asthma (EPR-3)” (4). Very similar guidelines published by GINA are followed elsewhere in the world. Treatment typically follows a step-wise course, where patients try a medication or combination of medications, and if those do not work then additional and/or different treatments are added. Patients with intermittent asthma are typically started on inhaled short-acting beta2 agonists (SABA) on an “as needed” basis. For persistent asthma, daily doses of inhaled corticosteroids (ICS) are used either alone or in combination with long-acting beta2 agonists (LABA). Lastly, for patients who are not adequately controlled with a combination of ICS/LABA and have allergic asthma, the mAb omalizumab (Xolair®) can be utilized. For those not controlled with ICS/LABA and have eosinophilic asthma, the mAb mepolizumab (Nucala®) is recommended.

This is all summarized in the following table.

The standard of care treatments cost approximately $500 per year for SABAs, $3,500 per year for LABAs, and approximately $23,000 for Xolair®. The best selling drugs in each class and their global revenues for 2015 are as follows:

- SABA - ProAir®: $549 million
- LABA/ICS combination - Advair®: $5.6 billion
- mAb - Xolair®: $1.9 billion

IL-4 and IL-13 Involvement in Asthma

Recent research has shed light on the understanding of the molecular mechanisms underlying Th2/T2-driven asthma, which has revealed Interleukin (IL)-4 and IL-13 as key components of disease pathology. Interleukins, which are a subset of a group of messenger molecules known as cytokines, have immunomodulatory properties and are released by different types of cells of the immune system in response to various stimuli. IL-4 and IL-13 are secreted mostly by lymphocytes including Th2 cells and Type II innate lymphoid cells (ILC2) cells as well other sources, and they drive a number of processes involved in asthma such as the recruitment of eosinophils, enhancement of airway smooth muscle contractility, and the promotion of airway remodeling. This pathway also induces biomarkers such as FeNO.

IL-4 and IL-13 exert their effects through binding to the extracellular portions of the heterodimeric receptor complex composed of the IL-4 receptor alpha-subunit (IL-4Rα) and the IL-13 receptor α1-subunit (IL-13Rα1), as shown in the following figure. IL-4, but not IL-13, can also activate signaling through interaction with the IL-4Rα and γC chain complex. Thus, by inhibiting IL-4Rα, it is possible to block the signaling pathways activated by both IL-4 and IL-13. Importantly, IL4Ra is highly expressed on the airway epithelium, which is a key tissue in asthma pathogenesis.

IL-4Rα is a Validated Target for Treating Asthma

Regeneron Pharmaceuticals, Inc. (NASDAQ: REGN) and Sanofi (NYSE: SNY) are developing dupilumab, a fully human monoclonal antibody that binds to IL-4Rα. The antibody, which is administered as a subcutaneous injection, has been tested in two Phase 2 clinical trials to examine its effect in treating persistent moderate-to-severe asthma.

Wenzel et al., 2013: This was a randomized, double-blind, placebo-controlled parallel group Phase 2a study that enrolled 104 patients with persistent, moderate-to-severe asthma as well as an elevated blood eosinophil count (≥ 300 cells per microliter). The 300 cells per microliter cutoff has been used in previous clinical trials and is typically associated with more severe asthma. The primary outcome of the study was the occurrence of an asthma exacerbation. Results showed that of the 52 patients treated with placebo, 23 (44%) experienced an asthma exacerbation, while of the 52 patients treated with dupilumab, only 3 (6%) experienced an asthma exacerbation (P<0.001). All secondary endpoints favored dupilumab as well, including a decrease in FeNO. Dupilumab was generally well tolerated, with the most common adverse event being injection site reaction, experienced by 29% of those on dupilumab compared to 10% of those on placebo.

Wenzel et al., 2016: This was a randomized, double-blind, placebo-controlled Phase 2b study that enrolled 769 patients with uncontrolled persistent asthma regardless of eosinophil count. Patients were randomized 1:1:1:1:1 to treatment with: 1) 200 mg dupilumab every 4 weeks (n=154), 2) 300 mg dupilumab every 4 weeks (n=157), 3) 200 mg dupilumab every 2 weeks (n=150), 4) 300 mg dupilumab every 2 weeks (n=157), or 5) placebo (n=158). Results show that dupilumab significantly reduced the annualized rates of severe asthma exacerbations compared to placebo. The following figure shows that this effect was seen in patients with eosinophil counts >300 cells per microliter of blood (top graph) and in patients with <300 eosinophils per microliter of blood (bottom graph). However, dupilumab was more effective in those patients with elevated eosinophil counts, which agrees with the results seen in the first study. Lastly, decreases in FeNO were greater for patients treated with dupilumab every two weeks.

These results show that the IL-4Rα is an effective target for therapeutic intervention in the treatment of asthma. While all asthma patients may benefit from IL-4Rα targeted treatment, it appears that those patients with elevated eosinophil counts (>300 eosinophils per microliter of blood) will derive the greatest benefit from this treatment.

Dual Targeting Is The Key

A number of other IL-4 and IL-13 targeted therapies have been tested in clinical trials; however, these therapies have not shown consistent efficacy in treating asthma, possibly due to the redundancy in IL-4 and IL-13 signaling, suggesting that dual blockade of these cytokines will be required for a potent asthma treatment. For example, inability to target both IL-4 and IL-13 has led to the failure of a number of agents over the past decade:

Tralokinumab (AstraZeneca) – A fully human anti-IL-13 monoclonal antibody previously studied in a placebo-controlled Phase 2 study in 194 asthma patients with moderate-to-severe uncontrolled disease, with results showing no effect on the Asthma Control Questionnaire (5). The drug did decrease the need for short-acting bronchodilators, an effect that was most pronounced in patients with elevated IL-13 in the sputum.

Lebrikizumab (Genentech) – A humanized anti-IL-13 monoclonal antibody previously studied in a Phase 2 clinical trial, with results showing an improvement in lung function, particularly in patients with elevated periostin levels in their blood (6). However, the antibody was not effective at decreasing asthma exacerbations.

An important takeaway from the past clinical studies involving IL-4/IL-13 targeted therapies is that it is very important to identify the proper patient population to study. Patients with elevated eosinophils appear to respond best to treatments that target IL-4 and IL-13, as was the case in both of the trials examining dupilumab as well as the subset analysis in the study of pitrakinra (discussed below). Thus, future clinical trials involving IL-4/IL-13 targeted therapy in asthma should focus on this group in order to maximize the chance for success.

A Local Approach Remains Attractive

In addition to patient selection and appropriate targeting, dose and potency likely play a role in response to these treatments. Two predecessor drug candidates administered via local administration, pitrakinra and altrakincept, did not achieve proof of concept in asthma human clinical trials likely due to a lack of potency and patient stratification. This is of importance because PRS-060 with an inhaled delivery is likely to deliver significantly higher concentrations in the lungs than a systemically administered mAb such as dupilumab.

Altrakincept (Amgen) – A recombinant form of the IL-4Rα that is administered through a nebulizer, previously studied in a Phase 1/2 clinical trial. Data show that both single and multiple doses improved lung function and reduced airway inflammation; however, later clinical trials showed no effect on asthma symptoms or lung function. This could be due to an insufficient amount of drug administered and/or similar affinity as the natural receptor. In addition, these trials were performed before there was an appreciation of biomarker-based stratification of asthma patients based on T2-driven disease. PRS-060’s affinity for IL-4Rα (low picomolar) is significantly higher than the affinity between IL-4 ligand and IL-4Rα.

Pitrakinra (Aerovance) – An altered form of IL-4 that is dosed through inhalation. Pitrakinra binds to the IL-4Rα without activating signaling pathways while blocking the binding of IL-4 and IL-13. A Phase 2b clinical trial showed no effect on asthma exacerbations in the total patient population; however, the drug did show efficacy in patients with increased eosinophil counts (>350 eosinophils per microliter of blood). PRS-060 looks to have increased in vitro and in vivo activity compared to pitrakinra, so it is likely that Aerovance was on the right track with pitrakinra with a local approach but did not adequately design its clinical trial in terms of patient selection or dose high enough levels of the drug considering its potency issues.

PRS-060 Has a Number of Potential Advantages

PRS-060 is an Anticalin® that binds with high affinity (picomolar) and specificity to IL-4Rα. Pieris is developing PRS-060 as an inhaled therapeutic to be taken alongside the standard of care inhaled therapies such as SABA, ICS, or ICS/LABA. PRS-060 is designed to act locally in the lungs. In contrast to injected mAbs, a very large fraction of inhaled PRS-060 is bioavailable at the airway epithelium. This is in direct contrast to mAb approaches, such as mepolizumab (Nucala®), which was reported to have a concentration 500 to 1,000-fold less in the lungs compared to the plasma in a primate study (7). Preclinical data shows that one dose of PRS-060, at therapeutically relevant concentrations, can decrease IL-13 induced signaling for up to 24 hours, thus indicating that PRS-060 may be capable of being dosed once or twice daily. The use of an Anticalin® to treat asthma has a number of potential advantages over the use of a monoclonal antibody, including:

- Localized Delivery: Since PRS-060 can be administered through inhalation, there will be lower systemic exposure to the drug, which could lead to a better side effect profile with long-term use. In contrast to mAbs, any PRS-060 that enters the systemic circulation from the lung is rapidly cleared by the kidneys, thereby focusing the local activity of the drug. The company has demonstrated technical feasibility for inhalation as both a wet aerosol and dry powder, demonstrating the favorable stability profile of the Anticalin® drug class.

- Convenience: Asthma patients are already used to taking inhaled products, thus an additional inhaled treatment would not be overly burdensome. However, a monoclonal antibody treatment, which must be delivered by injections that can be painful or by intravenous infusion, would likely require a trip to the doctor’s office, such as is the case with Xolair®, which must be administered in a healthcare setting according to its prescribing information (8).

- Flexibility: PRS-060 could potentially be formulated for either twice daily or once daily dosing, allowing it to be potentially combined with other inhaled standard of care therapies that are also dosed either twice daily or once a day. For example, Advair® is dosed twice daily.

- Cost: PRS-060 is produced in bacterial cells, as opposed to mAbs that must be produced in mammalian cells. Proteins produced in bacterial cells are orders of magnitude cheaper to produce than proteins produced in mammalian cells; thus, PRS-060 is likely to be much less expensive than mAb therapy. Furthermore, PRS-060 reaches its target IL-4Ra on lung epithelium much more readily than injected mAbs. This means that the actual amount of PRS-060 dosed will be much lower than for a mAb (potentially 10-fold less), leading to a lower cost as well for the consumer. Decreased costs would not only be more attractive to prescribing physicians and third-party payers but could also lead to a broader patient population than could be achieved with a more expensive therapy, thereby creating a new market for Pieris or its commercial partner.

PRS-060 Development Plan

Pieris is continuing preclinical work with PRS-060 such that a first-in-human Phase 1 study can be initiated in the first half of 2017. Earlier work was presented in September 2015 by Pieris advisor Professor Gary Anderson, the director of the Lung Health Research Center at the University of Melbourne at the annual European Respiratory Society annual meeting. The preclinical data demonstrate the drug-like properties of Anticalins and the rationale for inhaled delivery. Pieris also has presented data showing that PRS-060 exhibits both time-dependent and concentration-dependent antagonism of the target in a human transgenic inhalation mouse model.

Using the knowledge gained from prior clinical trials of IL-4Rα-targeting therapies, the company is likely to initially develop PRS-060 as a treatment for those with moderate-to-severe asthma and an elevated eosinophil count (i.e., >300 cells per microliter). While this does decrease the initial market size for clinical studies, targeting this patient population nonetheless presents a very large commercial opportunity, yet is a time- and cost-effective way to de-risk the program, and does not preclude broadening the use of the drug in later studies or once approved. I note that AstraZeneca just reported positive Phase 3 data from two trials with benralizumab plus ICS/LABA for the treatment of severe asthma, and the enrollment criteria stipulated a baseline blood eosinophil count ≥300 cells per microliter (9). This is clearly a strategy big pharma appreciates.

The first-in-human study is likely to involve healthy volunteers; however, given the effect that other IL-4Rα-targeting therapies have had on FeNO, it may be feasible to evaluate this biomarker in the healthy volunteer population to examine the mechanism of action, depending on the initial levels of FeNO in volunteers enrolling in the study. This is similar to what Pieris performed in the first-in-human study of PRS-080, in which an increase in blood iron levels was detected in a population of healthy volunteers treated with the drug, thus indicating that the drug was working as anticipated.


Recent impressive data with dupilumab in patients with uncontrolled, persistent asthma validate the IL-4Rα target for PRS-060. Previous clinical trials demonstrate the importance of patient stratification and localized delivery as effective ways to increase the odds of success. By effectively testing for validated biomarkers of efficacy, such as a decrease in FeNO, it is likely investors will get a good sense of the utility of PRS-060 even in early clinical studies.

For Pieris, the goal appears to be to demonstrate human proof-of-concept as quickly as possible, and the recent dupilumab data suggest that early proof-of-concept trials can be reproduced in larger late-stage programs. The recent $16.5 million financing suggests that Pieris is getting ready to ramp up its preclinical and clinical activities in the coming quarters. At June 30, 2016, I project Pieris will hold approximately $43 million in cash, about 40% of the fully-diluted market capitalization.

PRS-060 offers several potential very interesting advantages over injectable mAbs currently on the market, such as Xolair® or Nucala®, or moving through late-stage clinical trials, including dupilumab or benralizumab. These include cost, localized delivery, and dosing convenience and flexibility. Uncontrolled asthma is an enormous market, estimated at $23 billion by 2023 (10). Pieris, with PRS-060, could be a major player in the coming years.


This article is written by Jason Napodano, CFA of BioNap, Inc.
Please see additional important information on our Disclaimer.


  1. Hi Jason, What do you think of the financing announced on Friday?

    1. I Tweeted some thoughts about this on Friday. I think PIRS raised cash because they wanted to sure up the balance sheet and let investors know they plan to move forward with all aspects of the pipeline - i.e. PRS-060, PRS-080, and PRS-I/O. They should have $43 million in cash on hand when they report Q2 numbers. That's solid, and provides them flexibility to do a lot of different things over the coming months.

      I like the terms. I saw some nit-picking about the financing on Twitter, but these are people with obvious unrealistic expectations. Show me another small-cap biotech that raises cash at ABOVE MARKET prices for the shares?? Yes, there were warrants involved, but this is standard practice for PIPES and biotechs under $500 million. At least the exercise prices are also above market and that should provide additional capital to the company in the future.

      Based on my experience with these things, my guess is that BVF approached PIRS about making the investment. They are a Top-10 biotech fund and obviously wanted in the stock with a larger position (too large) to buy on the open market. Yes, existing shareholders would have loved it if BVF bid up the stock as they established their ~$10M position, but it's not always that simple. I think the strong pricing and shows institutional interest and with a basic market capitalization now only $100M, the EV is now less than $60M. I don't think you can find a better platform out there for cheaper!