In a deal worth approximately $250 million, Regeneron Pharmaceuticals will acquire Checkmate Pharmaceuticals in a deal that expands the buyer’s immuno-oncology pipeline.

Checkmate’s lead candidate is included in the deal. Vidutolimod (CMP-001), is being developed as a monotherapy and in numerous combinations—including in tandem with Regeneron’s marketed multi-indication cancer drug Libtayo (cemiplimab-rwlc), for which the companies began patient dosing in December 2021 in CMP-001-009, a Phase II trial (NCT04916002). The study—expected to attract 279 participants—is enrolling patient cohorts focused on the combination’s effectiveness against anti-PD-1 refractory cutaneous squamous cell carcinoma (CSCC) and Merkel cell carcinoma.

CSCC is one of the three cancers for which Libtayo is indicated; the others are basal cell carcinoma (BCC) and non-small cell lung cancer (NSCLC).

Under its generic name of cemiplimab, the drug is under development for additional indications: first-line NSCLC in combination with chemotherapy, second-line cervical cancer, adjuvant CSCC (all Phase III); as well as metastatic or locally advanced CSCC, neoadjuvant CSCC, and second-line cervical cancer in combination with ISA Therapeutics’ ISA101b (all Phase II).

Cemiplimab is one of 13 oncology candidates in Regeneron’s pipeline. Two other candidates have advanced to Phase II: odronextamab, a CD20 x CD3 antibody indicated for B-cell non-Hodgkin lymphoma; and REGN5458, a BCMA x CD3 antibody for multiple myeloma. The rest of the pipeline consists of 10 Phase I candidates.

Investors roared their approval of the acquisition deal with a buying surge that sent Checkmate shares more than quadrupling in trading today, to $10.41 a share as of 1:30 p.m. ET.

Vidutolimod is a next-generation CpG-A oligodeoxynucleotide Toll-like receptor 9 (TLR9) agonist delivered in a virus-like particle. Administered into the tumor, vidutolimod is believed to induce and expand anti-tumor T cells—as well as induce tumor regression as a monotherapy in patients whose tumors previously progressed on PD-1 checkpoint inhibition.

“The unique combination of a differentiated Toll-like receptor 9 with other antibody-based oncology agents may result in increased clinical benefit and provide new treatment options for patients in need,” Regeneron president and CEO Leonard S. Schleifer, MD, PhD, said in a statement. “As we continue to advance and expand our research efforts in immuno-oncology, the acquisition of Checkmate will add a promising new modality to Regeneron’s toolkit of potential approaches for difficult-to-treat cancers.”

Vidutolimod is also under study in three other clinical trials, including:

• CMP-001-011, a randomized Phase II/III trial (NCT04695977) comparing vidutolimod plus Bristol Myers Squibb’s cancer blockbuster Opdivo® (nivolumab) to Opdivo alone in first-line metastatic or unresectable melanoma.
• CMP-001–010, a Phase II trial (NCT04698187) assessing vidutolimod plus Opvido in anti-PD-1 refractory advanced melanoma.
• CMP-001-007, a Phase II trial (NCT04633278) of vidutolimod in combination with Merck & Co.’s cancer blockbuster Keytruda® (pembrolizumab) in recurrent or metastatic squamous cell head and neck cancer.

Positive Phase Ib data

At the Society for Immunotherapy of Cancer (SITC) 36th Annual Meeting, held November 10–14, 2021, Checkmate presented positive data from CMP-001-001, a Phase Ib trial (NCT02680184) assessing vidutolimod in patients with PD-1 blockade-refractory melanoma, both as monotherapy and in combination with Keytruda.

In patients treated with the combination, the study showed an overall response rate (ORR) of 23.5% according to Response Evaluation Criteria in Solid Tumors (RECIST) v1.1, as well as and a duration of response of 25.2 months. In addition, documented abscopal responses were seen in distant, un-injected lesions.

“We believe that the data we have generated with vidutolimod positions Checkmate at the forefront of the innate immune activator field,” stated Art Krieg, MD, Checkmate’s founder and CSO. “It is our hope that Regeneron’s resources and expertise will help accelerate the development of vidutolimod and realization of the full potential of our VLP platform for immunotherapy.”

Through a subsidiary, Regeneron plans to launch a tender offer to acquire all outstanding shares of Checkmate for $10.50 a share, all cash—more than quadruple that company’s closing share price yesterday of $2.41, down 5% from $2.54 on Friday. Before today’s surge, Checkmate’s share price had fallen 61% from a year ago, when it stood at $6.22, and plunged 84% from its IPO price of $15 a share.

The closing of the tender offer will be subject to conditions that include the tender of at least a majority of the outstanding shares of Checkmate common stock, the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions. Upon the successful completion of the tender offer, Regeneron plans to acquire all shares not acquired in the tender through a second-step merger.

The acquisition is expected to close in mid-2022.

“We are thrilled that Checkmate will become part of Regeneron, a biotechnology leader that shares our deep appreciation for science, hunger for ground-breaking discoveries and commitment to helping patients defeat cancer,” added Checkmate’s president and CEO Alan Bash.