Takeda Pharmaceutical (OTC:TKPYY) (TKPYY), one of the biggest healthcare companies in the world and arguably the most well-known and most respected of the Japanese pharmaceutical giants, just announced the signing of an agreement that will see it team up with a company called Shattuck Labs in the oncology space. The latter is a privately held company based out of Austin, Texas and is the latest in a line of tiny healthcare entities with which Takeda has struck an alliance.
With Shattuck being a relatively small entity, there is limited information available as to the technology that underpins the collaboration between it and Takeda. As such, the implications for Takeda and its shareholders as far as how this deal might play out are concerned are a little bit murky. With that said, however, a bit of digging can offer some clarity, especially as regards to the concept that Takeda is hoping will provide it with the next generation of cancer therapies.
With this in mind, here is a look at the science that underpins Takeda and Shattuck's latest collaboration with an attempt to figure out what it might mean for shareholders if and when it plays out successfully or otherwise going forward.
The easiest way to tackle this is from the top down, so let's start with a look at immunotherapy. Cancer immunotherapy aims to harness the immune system of the patient in an attempt to stimulate the body (or more accurately, the body's natural response to pathogens) to attack, kill and remove cancer cells. There are many different approaches to doing this, but they generally involve one of three high-level concepts. The first is rooted in teaching the immune system to recognize cancer cells through some sort of antibody-based engineering. The second is through the removal of a cancer cell's natural ability to hide itself from the immune system. The third is the stimulation of the immune system to such a degree that, regardless of the ability of the cancer cell to hide itself, the cells in question are overpowered and destroyed as appropriate.
Most immunotherapy types harness one of these high-level concepts.
Shattuck has developed a technology that it calls its Agonist Redirected Checkpoint (ARC) platform and the latest collaboration is rooted in certain assets that are born out of this platform. The way it works is by combining two binding domains to create fusion proteins that potentially restore and enhance immune system function in a single construct. In other words, the platform is able to create immunotherapy assets that combine two or more of the three high-level concepts outlined above and – in doing so – develop a treatment that should theoretically be more effective than a single asset on its own.
And there is evidence to suggest that this is the case. This link redirects to a healthcare conference at Boston back in May this year, at which Taylor Schreiber, CSO of Shattuck, gave an example of how the technology works and a real-life application. Specifically, he discussed a drug that simultaneously blocks signaling through PD-1 and activates signaling through OX40. For those not familiar with these two treatment approaches, PD-1 is rooted in a cancer's ability to hide itself from the immune system. Blocking signaling through PD-1 reveals the cancer cells to our natural attack cells (T cells, etc.).
OX40 is rooted in the signaling of the immune system to come and attack cancer cells. Through the upregulation of OX40, the immune system should be able to overwhelm cancerous cells and remove them from the body far more efficiently than might otherwise be the case.
As mentioned, normal drugs would only use one of these approaches. With Shattuck's ARC technology, the idea is to use both at the same time and provide a sort of 360° therapy.
So where does Takeda to come into this?
The collaboration sees Takeda team up with Shattuck on two pre-clinical and four discovery stage programs. The Japanese pharma giant will provide funding for pre-clinical and clinical development and will have the option to take an exclusive license to further develop and commercialize up to four ARC molecules resulting from the collaboration.
The idea, then, is that Takeda is trying to harness this technology in an attempt to get a jump on some of its healthcare giant competitors in the space.
Immunotherapy, as things stand, is dominated by companies like AstraZeneca PLC (AZN) and Merck & Co., Inc. (NYSE:MRK). The majority of the treatments offered by these two companies, however, and this includes those in their respective development pipelines, are single approach immunotherapy assets. If Takeda can use Shattuck's ARC technology to demonstrate that a double pronged approach is more effective than a single, then it could become a front runner in oncology very quickly.
Of course, these are early-stage assets and there is no guarantee that they will ever reach the clinic, never mind commercialization. With that said, however, we were saying the same thing about immune oncology as little as a decade ago.