Here comes a third desmoid tumour player

Desmoid tumours are slow-growing, usually benign and very rare, so investors in Parabilis Medicines – a US biotech that this week filed to float on Nasdaq – might well wonder just how many players a market like this can sustain.

That’s because desmoid tumours are the lead indication for Parabilis’s lead pipeline asset, the β-catenin:TCF4 inhibitor zolucatetide, which is expected to enter phase 3 in this setting next year. However, by the time zolucatetide is approved there will likely already be two desmoid tumour drugs on the market: Merck KGaA’s Ogsiveo and Immunome’s varegacestat.

Both competitors have put up stellar data, showing large reductions in risk of progression or death versus placebo, and increases in response rates, versus placebo in the Defi and Ringside trials respectively. Ogsiveo was FDA approved in 2023; Immunome submitted a US filing for varegacestat last month, and is set to report full data from Ringside shortly at ASCO.

For its part Parabilis reckons zolucatetide is the first and only investigational project that inhibits the β-catenin:TCF interaction. This, it says, is the critical downstream node of the Wnt/β-catenin pathway, activating mutations of which are present in over 10% of all cancers and span a broad range of tumour types.

$800m so far

And it has already received significant backing for its approach, having only in January closed a $305m series F round, taking the total it’s raised from venture financiers to over $800m. On Monday Parabilis got $50m up front from Regeneron in a discovery deal to develop ADCs using payloads derived from the Helicon technology that lies behind zolucatetide.

Under this deal Regeneron also committed to invest $75m in Parabilis’ s next equity financing – which came the following day, when a filing was submitted to the US SEC for a Nasdaq IPO in which Regeneron thus stands to be a major participant. At present it’s not clear how much Parabilis hopes to raise, or at what valuation.

Given that desmoid tumours affect just two to four people per million each year, what’s driving the enthusiasm? One clear factor is German Merck’s endorsement of Ogsiveo, which came as part of a takeover worth nearly $4bn of the drug’s originator, SpringWorks, last year.

Another key point is Parabilis’s claim that zolucatetide has activity in patients who have progressed on gamma secretase inhibitors like Ogsiveo. Phase 1/2 data at last year’s ESMO showed three responses among seven subjects who had had prior gamma secretase inhibitor treatment. The latest cut of the data, revealed in the S-1 filing, claims a 74% ORR among all 19 evaluable patients.

As such, the small size of the market might not be a problem, if zolucatetide is seen as a drug that might take share away from incumbents, rather than relying on any increase in addressable patients. Zolucatetide is also being tested in familial adenomatous polyposis, which has similarities with desmoid tumours, and in liver and colorectal tumours, but these uses are further behind.

And Parabilis’s pipeline also includes Helicon-based degraders, namely of ERG, of the androgen receptor and of β-catenin itself, but as these are all at the discovery stage they shouldn’t yet play a part in the business’s valuation.

Selected work in desmoid tumours

Source: OncologyPipeline.