BETHESDA, Md., March 16, 2021 /PRNewswire/ -- Northwest Biotherapeutics (OTCQB: NWBO) ("NW Bio"), a biotechnology company developing DCVax® personalized immune therapies for solid tumor cancers, today announced that development of the initial production capacity of the Company's Sawston, UK advanced manufacturing facility has been completed and the facility is now in the final stages of preparation for an application for certification by the UK Medicines and Health Products Regulatory Authority ("MHRA").
To date, the Company's production of dendritic cell vaccine products in the UK has been taking place in a GMP (clean room) facility in London, with a capacity of about 4 - 6 patients per month. The Sawston facility contains a total of 88,345 square feet on two floors. The initial production capacity comprises two manufacturing suites, occupying approximately 4,400 square feet on the ground floor. These two suites, together with some additional support and storage space, have a potential production capacity of dendritic cell vaccines for about 40 to 45 patients per month, or approximately 450 to 500 patients annually, subject to regulatory approval.
An intensive recruitment program has been underway for well over a year, and has successfully hired and trained the necessary 30 senior technical managers, scientists and staff technicians and operators for manufacturing, quality control and other operations of the first two production suites. The recruitment process for experienced personnel with these types of expertise is highly competitive because the cell therapy and immunotherapy fields are growing rapidly and the pool of experienced specialists is very limited. With the initial team of 30 specialists on board and trained, the recruitment and training are now continuing to expand the team. When the Sawston facility is fully built out and in full operation, it is estimated that it will employ in excess of 300 highly skilled personnel, including many who may be trained through apprenticeships in the Sawston facility.
Since the initial dendritic cell vaccine production capacity will occupy only a small fraction of the total space in the Sawston facility, it is anticipated that additional capacity for third party production of other cell therapy products may be developed in some of the other space. GMP facilities are capital intensive both to develop and to operate. Third party production of other products will help support the Sawston facility costs and, in light of the growing demand for cell therapy manufacturing capacity, could substantially increase the asset value of the Sawston facility. The capacity for production of other products will also be an important resource for the region.
Development of the Sawston facility has been under way for more than two years, and has progressed on parallel tracks in multiple areas, including physical buildout of the first two production suites, equipment procurement and validation, specialized operating systems, drafting of regulatory documents, and recruitment and training of key scientific and technical personnel for the first two production suites.
All of the development activities for the Sawston facility have been carried out under contract with Advent BioServices, who is also the operator of the facility.
The facility is now in the Performance Qualification (PQ) stage, following completion of the Design Qualification (DQ), Installation Qualification (IQ), and Operations Qualification (OQ) stages. Each of these stages has taken many months of work. In the PQ stage, practice runs are conducted for months and the performance data is collected to show that the operations meet all of the applicable regulatory requirements (sterility, quality control testing, etc.). Those data then form a major part of the application to MHRA for certification of the first phase of the facility. The Company currently anticipates that the PQ stage will be completed and the certification application will be submitted to MHRA within approximately the next six to eight weeks.
The physical buildout of Phase 1a of the facility was carried out last year, and was completed ahead of schedule at the beginning of October despite COVID operating restrictions, by having the contractors work double shifts and other special measures. Advent BioServices worked with R.G. Carter as the general contractor.
R.G. Carter and its team of sub-contractors did an exceptional job of overcoming the COVID related difficulties and achieving the early completion. For example, they enabled and managed double shifts throughout the project, worked out special operating arrangements to enable construction to proceed in a socially distanced manner, found alternate sources for specialized materials when the original suppliers were unable to deliver, and made special travel arrangements to bring European equipment vendors' installation engineers to Sawston. The Company is grateful to R.G. Carter and its sub-contractors for these special arrangements and solutions, and is looking forward to working with this team on subsequent phases of the Sawston facility.
Phase 1a cost approximately £3.5 million ($4.6 million), including the double shift costs, and covered the support facilities for the first two manufacturing suites, which had already been built. Approximately £1.35 million ($1.77 million) of the Phase 1a cost was funded through a competitive loan from the Cambridgeshire and Peterborough Development Authority. This funding was instrumental in enabling the Sawston facility to reach initial manufacturing readiness. The Company is very grateful to the Development Authority for this funding, and is looking forward to continuing to work with the Authority.
Following the physical buildout, the extensive and specialized equipment was sourced, installed, tested and validated. The COVID circumstances posed a number of difficulties. For example, there were supply chain and delivery difficulties to obtain the equipment. In addition, foreign vendors were unable to travel to the UK to conduct the installation, testing and validation as would usually occur. UK personnel had to go through training to conduct these activities instead of the vendor. The data from the testing and validation of each individual piece of equipment is required for the application package for certification of the facility. This work is now in the process of being completed.
Certain specialized operating systems (environmental management systems, quality management systems, lab information management systems and others) are required to measure, tightly control and collect data on air flow sterility and turnover, particle counts, and other conditions, as well as lab operations. The sourcing, installation, testing and validation of these specialized systems also encountered difficulties due to COVID, but are now nearing completion.
In parallel with the physical buildout, the equipment and the specialized operating systems, an intensive program has been under way to draft the necessary SOPs (standard operating procedures) and other regulatory documents. SOPs are tailored to a specific facility and cannot be procured ready-made. Detailed SOPs must cover every aspect of the facility's operations, from the time supplies arrive at the loading dock and are placed in quarantined storage all the way through to the release of finished doses of the dendritic cell vaccines to the physician and patient. Over 500 SOPs and other regulatory documents have been drafted and tested over the last year-plus period, involving many, many thousands of man hours. This set of regulatory documents is now essentially complete for the initial launch of product manufacturing in the Sawston facility.
As previously reported, the Company has also been moving forward on optimization of the Flaskworks system for manufacturing of dendritic cell vaccines. The buildout of the Sawston facility is purposefully being done in phases, both for efficiency in the timing of capital costs and to allow flexibility in operations and usage. It is anticipated that implementation of the Flaskworks system will enable the buildout of some or all of the rest of the 88,345 square foot facility, beyond the initial manufacturing suites, to be simplified and streamlined at reduced cost. About Northwest Biotherapeutics
Northwest Biotherapeutics is a biotechnology company focused on developing personalized immunotherapy products designed to treat cancers more effectively than current treatments, without toxicities of the kind associated with chemotherapies, and on a cost-effective basis, in both North America and Europe. The Company has a broad platform technology for DCVax® dendritic cell-based vaccines. The Company's lead program is a 331-patient Phase III trial of DCVax®-L for newly diagnosed Glioblastoma multiforme (GBM). GBM is the most aggressive and lethal form of brain cancer, and is an "orphan disease." This Phase III trial is now completed and locked down, with announcement of top line data expected in the coming months. The Company is also pursuing development of DCVax®-Direct for inoperable solid tumor cancers. It has completed a 40-patient Phase I trial and, as resources permit, is preparing for Phase II trials. The Company previously conducted a Phase I/II trial with DCVax-L for advanced ovarian cancer together with the University of Pennsylvania.
Disclaimer Statements made in this news release that are not historical facts, including statements concerning future treatment of patients using DCVax and future clinical trials, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "expect," "believe," "intend," "design," "plan," "continue," "may," "will," "anticipate," and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. We cannot guarantee that we actually will achieve the plans, intentions or expectations disclosed in our forward-looking statements and you should not place undue reliance on our forward-looking statements. Actual results may differ materially from those projected in any forward-looking statement. Specifically, there are a number of important factors that could cause actual results to differ materially from those anticipated, such as risks related to the Company's ability to enroll patients in its clinical trials and complete the trials on a timely basis, uncertainties about the clinical trials process, uncertainties about the timely performance of third parties, risks related to whether the Company's products will demonstrate safety and efficacy, risks related to the Company's ongoing ability to raise additional capital, and other risks included in the Company's Securities and Exchange Commission ("SEC") filings. Additional information on the foregoing risk factors and other factors, including Risk Factors, which could affect the Company's results, is included in its SEC filings. Finally, there may be other factors not mentioned above or included in the Company's SEC filings that may cause actual results to differ materially from those projected in any forward-looking statement. The Company assumes no obligation to update any forward-looking statements as a result of new information, future events or developments, except as required by securities laws.
Introduction This report addresses three issues: The capability of the Sawston UK plant to manufacture Northwest Biotherapeutics’ dendritic cell vaccine in accordance with regulatory requirements and to scale up to manufacture it in substantial quantities. (Note that in the US, this product is...
The capability of the Sawston UK plant to manufacture Northwest Biotherapeutics’ dendritic cell vaccine in accordance with regulatory requirements and to scale up to manufacture it in substantial quantities. (Note that in the US, this product is referred to as DCVax-L, but may go by a different brand name(s) in foreign markets and perhaps in the US. Hence, I will use the generic term dendritic cell vaccine often in this report.)
Thoughts on when and how top line data from the phase 3 trial might be published.
The readthrough from GameStop trading on how retail traders might catalyze a short squeeze of NWBO stock if phase 3 results suggest probable approval of the dendritic cell vaccine.
NWBO has been working for several years to prepare the Sawston UK facility for vaccine production.
It has been diligently preparing the facility to satisfy CMC requirements that are essential for regulatory compliance and believes that it may be able to apply for certification in 6 to 8 weeks
At this early stage, I estimate that Sawston could support commercial sales at an annual run rate of $75 million later this year with the first two production suites, but could then over time be scaled up to support $750 million annually. Beyond the latter level, the implementation of the Flaskworks technology and a substantial amount space still available for expansion at the 88,345 square feet Sawston facility should be able to support demand for the dendritic cell vaccine not only for glioblastoma but potentially for other solid tumors. This production capacity is a very valuable asset often not seen in emerging biotechnology companies.
Interestingly, NWBO has been treating patients on a compassionate use basis in the UK at a London hospital site for some years. At this point in time, the facility can treat 4 to 5 patients per month. The importance of this is that it has allowed Northwest to deliver the vaccine in situations where there is not the homogeneity of patients seen in clinical trials; it is more real life.
The status of the Sawston facility and the attitude of UK authorities toward facilitating breakthrough therapies suggests that approval in the UK could be the first in any world market. UK Prime Minister Boris Johnson recently made a speech in which he stated that having left the EU, the UK plans to be a leader in bringing new technologies and innovations to the world. Bear in mind that the UK was the first country to approve Pfizer/ BioNTech’s COVID vaccine
One of the things that makes an approval decision easier for any regulatory agency is the dendritic cell vaccine’s modest side effect profile. Most cancer drugs are known for their toxicities that can sometimes be life threatening.
The long time span since the data lock on the phase 3 trial in October 2020 is most likely due to logistical issues stemming from COVID restrictions and preparation for publication of the data in a major medical journal.
Still, the potential remains that there could be a black swan event which makes the data equivocal in some respect. I have no idea what this might be, but this is always a risk in clinical trials. Bulls should not yet be taking victory laps.
In the case of GameStop, empirical evidence suggests that counterfeit shares created by illegal naked shorting meaningfully exceeded the 63 million legitimate registered shares outstanding. In this report, I also cite the case of Global Links which was an even worse case in which illegal naked shorts may have been ten or twenty times the number of legitimate registered shares. It is entirely conceivable that there are several hundred million counterfeit shares of Northwest Biotherapeutics that have been shorted.
Sawston UK Manufacturing Facility
Northwest recently issued a press release that describes milestones reached in developing its Sawston UK facility required to meet regulatory requirements for production of its dendritic cell vaccine. Most investors focus almost exclusively on clinical data in judging the potential for a new drug to be approved. However, in regulatory applications there are also the equally important needs to specify the characteristics of a product, how it is to be manufactured and assays to assure that quality can be maintained from patient to patient. In the US, this section of a BLA filing is called Chemistry, Manufacturing and Control (CMC). Different nomenclature is used with foreign regulatory agencies but in this report, I will refer to these elements as CMC regardless of the regulatory agencies involved.
It is all too often the case that emerging biotechnology and even large biopharma companies are overly focused on the clinical trial side and pay less attention to CMC. Even if the clinical data supports approval, not infrequently regulatory agencies find CMC deficiencies that cause them to reject approval until the issues are fixed resulting in delays of a year or more. The press release describes in detail the sophisticated efforts that have been underway at Sawston for several years. It also touches on the problems that COVID caused. The takeaway message for me is that NWBO has carefully gone through the many, many steps needed to submit a thorough CMC section within its regulatory filings. Uncertainty on how Northwest would address CMC in its regulatory filings was one of my greatest worries. I am much relieved. Here is what NWBO stated in the press release.
“The facility is now in the Performance Qualification (PQ) stage, following completion of the Design Qualification (DQ), Installation Qualification (IQ), and Operations Qualification (OQ) stages. Each of these stages has taken many months of work. In the PQ stage, practice runs are conducted for months and the performance data is collected to show that the operations meet all of the applicable regulatory requirements (sterility, quality control testing, etc.). Those data then form a major part of the application to MHRA (the British FDA) for certification of the first phase of the facility. The Company currently anticipates that the PQ stage will be completed and the certification application will be submitted to MHRA within approximately the next six to eight weeks.”
This disclosure is reassuring that approval probably will not be hung up due to incomplete CMC data. Obviously, there can be no absolute certainty, but it appears that NWBO has been diligent in this regard. Those of us who have followed the evolution of cell therapy understand that the manufacturing process is essential to success because the living cell is the product.
There were some interesting pieces of information in the release that along with a few assumptions allow us to estimate what level of commercial sales Sawston can support initially and in coming years:
NWBO stated that it will be able to seek MHRA certification of the Sawston facility within six to eight weeks that could provide treatment for 40 to 45 patients per month. Remember that the vaccine is given with six injections in the first year of treatment and followed by an injection every six months thereafter for as long as the patient is benefitting from treatment and the drug is available. All doses are made at one time after surgery and cryopreserved. So what magnitude of sales might this level of production support?
New cancer therapies routinely are priced at $300,000 to $600,000 or more per year of treatment. Not included in this price is the cost for handling their serious, often life threatening side effects. For example, the CAR-T drugs cost about $300,000 per patient for one year (which is a one-time only infusion of cells) but in some cases, the all-in cost including hospitalization and treating side effects can soar to $1,000,000. In contrast, NWBO has a good safety profile.
Bear in mind that the vaccine will not cure all patients so it is certain that some percentage of patients will not receive six doses in the first year. NWBO hasn’t commented on its pricing strategy, but it seems possible that it will be priced on a per dose basis. This suggests that revenues per patient treated may vary as some receive all doses and others less.
In an effort to be conservative although still reasonable, let’s assume an average price of $150,000, for all patients treated. This price level translates into annual sales of about $75 million from just the first two manufacturing suites, which occupy just a very small fraction of the 88,345 square foot building.
Sawston has significant additional space available for expansion that allow the Company to scale up a large number of production suites beyond the initial two that have been established. NWBO indicated that it has 30 skilled personnel now trained and functioning. With this initial team on board and trained, the recruitment and training are now continuing to expand the team. When the Sawston facility is fully built out and in full operation, it is estimated that it will employ in excess of 300 highly skilled personnel, including many who may be trained through apprenticeships in the Sawston facility. Scaling up to 300 could conceivably increase production capacity tenfold allowing for annual revenues of perhaps $750 million.
As the Flashworks technology is integrated into the manufacturing process in coming years, production can be even further scaled.
Based on the above assumptions, NWBO should be able to stay abreast of patient needs if the dendritic cell vaccine penetrates much of the glioblastoma market. Also bear in mind that the vaccine technology is applicable to all types of solid tumors so there is the possibility of needing much more production to treat other solid tumors in coming years.
Here is the bottom line. NWBO has developed a well thought out production plan. It is proceeding in stages or modules to manage the timing of the capital costs and to be flexible for developments such as implementing the Flaskworks system when appropriate. This is an impressive achievement for an emerging biotechnology company.
Here are some other observations based on the press release:
The Company has been producing dendritic cell vaccine products in a GMP (clean room) facility in a London hospital that has a capacity of about 4 to 5 patients per month. This compassionate use program has been ongoing for perhaps 5 years. Don’t jump to the conclusion that NWBO has been treating 4 to 5 patients every month for 5 years. This is just the current capacity.
NWBO hasn’t stated how many patients have been treated, but I am guessing that it might be around 50 patients.
The data from these patients will not be a formal part of the regulatory filings, but regulatory agencies will certainly look at the data to help judge if these “real life” results from compassionate use help support the phase 3 results.
One of the most important aspects of the compassionate use program is that it has allowed NWBO and physicians to develop real life experience outside the very structured clinical trial setting.
Waiting for Release of Top Line Data
Since the company locked the data base for the phase 3 trial in October 2020, we have been anxiously waiting for the final data analysis. Like most investors, I thought that the data would be released before now. However, having read the comments on the effect of COVID restrictions on building out Sawston, I think that I very much underestimated the effect of COVID on the time required. This process involves interactions between statisticians, the scientific advisory board, key opinion leaders and certain physician participants in the phase 3 trial. Trying to do this all on ZOOM meetings and resolve differences of opinions would have been challenging. Investors have been presented with three possible, broad based scenarios that span the potential outcomes for the trial.
Scenario 1: If successful, the phase 3 trial is a landmark study in glioblastoma that would change standard of care, medical practice in glioblastoma. The Company would want the data to be validated and widely disseminated by publishing it in a peer reviewed major medical journal like the New England Journal of Medicine (NEJM) or Journal of the American Medical Association (JAMA). This would be a gold stamp of approval by leaders in the medical community. These journals will not publish a clinical study if the results were previously revealed in a press release. Hence, NWBO is likely diligently working with a medical journal to prepare a thorough article before making a press release commenting in an abbreviated form on top line results. I think this is the most likely scenario. If so, I would hope to see this article in April.
Scenario 2: The hedge funds who are heavily shorting the stock claim that the trial clearly failed and NWBO for some reason has not acknowledged this. Hedge fund trolls deluge investor chat rooms on a daily basis with this allegation. I give this virtually no chance of being the case. NWBO management has a legal requirement to release material information in regulatory filings. In this dour scenario, there is no incentive for them to delay release of the data.
Scenario 3: There could be a case in which there is compelling evidence of efficacy but for some reason, the data is not clear cut. This would be some type of black swan event. In this case, NWBO would go to great lengths to present the data in the most favorable way to regulatory agencies to show that there is still a very positive benefit to risk. I don’t think this will be the case, but it can’t be ruled out. The GameStop Angle
For those of you who have followed my work, you will know that I firmly believe that certain hedge funds (the wolfpack) band together to launch short selling attacks on companies that can span several years. Northwest has been one of the most heavily attacked companies by this wolfpack. Key to this stock manipulation scheme is the use of illegal naked shorting that allows the wolfpack to counterfeit shares that in the case of NWBO could number in the hundreds of millions. I wrote a series of ten articles on illegal naked shorting that you may want to refer to in order to understand how Wall Street can create shares out of thin air without the knowledge and certainly without the approval of the affected company. See this link.
So you are probably asking how can I be so sure if the companies themselves can’t really track the creation of counterfeit shares. Well, it is based on a lot of anecdotal situations, each of which alone would just be curious, but in the aggregate provide a powerful indication that hedge funds and Wall Street trading desks routinely act in concert to exert considerable power (even control) over the price of a stock by overwhelming the market through selling counterfeit shares. There is one example that I would like to share with you that does show the power of this unholy alliance to create counterfeit shares. This is the case of Global Links.
Global Links was a company that provided computer services to the real estate industry. In early 2005, its stock price had dropped to a fraction of a cent. It had 1,158,064 shares registered and outstanding. At that point, an investor, Robert Simpson, decided to purchase all outstanding shares, He bought 1,158,064 shares in the open market at the prevailing price of $0.00434 for a purchase price of $5,205. He immediately took delivery of his shares and filed the appropriate forms with the SEC, disclosing he owned all of the company's stock. The day after he supposedly had acquired all of the company's shares, the volume on the over-the-counter market was 37 million shares and the following day saw 22 million shares change hands. This was all without Simpson trading a single share.
The wolfpack has brazenly operated for more than two decades without concern that anyone or anything could or would interfere with their stock manipulation schemes. This appears to have ended with the GameStop situation. Retail investors trading on Robinhood and communicating through Reddit combined with predatory hedge funds (I think the latter were more responsible than retail investors) to create a huge short squeeze in GameStop. The hedge fund Melvin Capital got butchered in this short squeeze. It suffered a 53% decrease in assets which had been about $12 billion before the squeeze. This indicates a $6.4 billion or more loss in January 2021 with an enormous short position in GameStop being cited as a primary reason.
There are 63 million registered and outstanding shares of GameStop. Melvin Capital has not released the data that would allow us to understand how many share of GameStop they were short. However, much of the $6.4 billion loss was attributable to this short position. It was widely reported in the media that the number of shares shorted was 140% of registered shares or 88 million shares, but I don’t know how this number was calculated. I have run scenarios that hypothesize that Melvin Capital might have been short 63 million shares, the equivalent of all registered shares outstanding, or possibly even more. If this hypothesis is correct, it could only happen if illegal naked shorting was heavily involved.
The wolfpack is no longer running free and wild on the plains of the stock market with no fear of predators. They have now become the hunted. The Robinhood crowd flush with eviscerating Melvin Capital and fellow hedge fund travelers of many millions and indeed billions of dollars are now stalking the wolfpack. If the phase 3 trial is successful, we could see a similar phenomenon with Northwest as with GameStop where frantic hedge funds are forced to cover at incredibly high stock prices. This would be poetic justice for the wolfpack.
BTW if you are familiar with Phase 3 DCVax-L trial data, it's not difficult to conclude the trial when unblinded and announced will readily meet its primary endpoint and at least its first secondary endpoint (it may also meet other secondary endpoints, but we still have no solid evidence as of now to confirm that).
NWBio annual shareholders meeting set on 18 May 2021 at 4:30pm. One interesting thing is the issue of raising the shelf (increasing authorized shares) which is the most anticipated by shareholders is missing in the proxy. It seems things would become interesting in the coming month.
The sole purpose of NWBio at the timebeing or after datalock is to commercialize DCVax-L, and to achieve that, RAs must first approve it.
So to prepare data/analyses of unblinded data for publication and/or public announcement, etc, in whatever order or form is just the means to achieve the above goal.
Then, you have the question of how to better achieve that goal: to get DCVax-L approved in UK first, followed by other countries in serial, or to aim at getting it approved in all four countries (plus other EU countries) in parallel. Then tactically, NWBio needs to prioritize its things to do differently.
To publish the unprecedentedly rich and trial-proved safe and efficacious data in a peer reviewed journal such as NEJM or The Lancet is easy, but it's better careful to prepare "the right" content in the right form in the publication, which should be not only reflection of the trial data but in RA agreeable/approvable form, because when it is published it's the final.
So for the publication in the case of NWBio, my understanding is it's not just to publish, but negotiate with RAs for what would be published in terms of details, priorities, and conclusions.
Because we are a small developing biotech company at such critically important inflection point, and we have been attacked viciously and endlessly in the past, we ought to hide our strength, bite our time, taking an unprecedented way toward approval for unprecedented trial and data.
If you understand the goal correctly, you would understand why NWBio has seemingly missed some "ambiguous self-imposed deadlines" because every time it missed it must have adapted its operation so that it can better achieve its goal and its only goal, which is to bring DCVax-L to as many patients as possible in a commercial setting, which in turn requires appropriate strategy and tactics to get it approved in as many countries as possible.
Yesterday it's strong buy at around $1.3; today as of now at 9:51am at around $1.26 is obviously a strong buy.