UroGen to raise $120m after positive bladder cancer trial

UroGen credit: Tali Bogdansky
UroGen credit: Tali Bogdansky

UroGen Pharma has published positive results from two clinical trials of its second product UGN-102 for the treatment of bladder cancer.

UroGen Pharma (TASE: URGN), which develops uro-oncological treatments, last week published positive results from two clinical trials of bladder cancer treatment UGN-102. This is the company's second product and it addresses a market of 80,000 patients, while the company’s first product Jelmyto, which has already been approved for upper tract urothelial cancer, addresses a smaller market of a few thousand patients.

Following publication of the results, Urogen announced it would raise $120 million in a private placement led by Ra Capital and Green Point Ventures, with participation from Acorn Bioventures, Monograph Capital and Horton Capital Partners Fund, LP.

The offering was priced at a 5% premium above the market price before the publication of the results. Following both announcements, Urogen’s stock gained 26% and the company was worth $530 million at market closing on Friday.

Unlike other biotech companies traded on Nasdaq, UroGen’s stock price did not peak in 2021 and fall last year. The stock's most recent peak was in 2018, when the company reported good results from Jelmyto, which led to the product’s approval in 2020. But as this product was meant for a relatively small market, and the revenue only amounted to a few tens of millions of dollars, it did not hold investor’s attention. UroGen had originally announced that this would be a "proof of concept product", while UGN-102 would be the first major product for the company. It seems that the market is now on board with the new dream.

UroGen’s chairman Prof. Arie Belldegrun, is a serial biotech entrepreneur who has already sold companies worth billions of dollars. The biggest of these deals was Kite Pharma, purchased by Gilead for $11.9 Billion. Belldegrun a professor of uro-oncology, told "Globes" following the two announcements, "I told you that this company would change medical practice in the field, and now the results show that I was right".

UroGen CEO Liz Barrett told "Globes,"Our product is intended for patients with low grade intermediate risk bladder cancer that today is treated by surgery. But the worse the patient’s condition is, the more likely the cancer is to reoccur. More than half the patients suffer from two or more recurrences, while about 25% suffer from 5 or more recurrences. Some of these patients are older and cannot have so much surgery even if they are minimally invasive".

The ATLAS trial began in 2021 and included a control group that underwent surgery. Post treatment, the groups had similar complete response rates, about 65%, so the trial was halted. But last week, new data showed that the UGN-102 arm had 55% less chance of recurrence.

The ENVISION trial featured patients after one recurrence, and the complete response rate was 79%. No data is currently available regarding the recurrence after treatment in the ENVISION trial, but based on the results of the ATLAS trial, the company expects these results to be positive as well, and if so, the product will be submitted for approval to the FDA in 2024, and hopefully launched in 2025.

Jelmyto, the approved product, has earned UroGen about $64 million in revenue and analysts expect peak sales of $150-$200 million in 2023. Barrett sees potential sales of UGN-102 of more than $1 Billion, and analysts agree.

What did you learn from the Jelmyto launch?

Barrett: "Urologists aren’t as quick adopters of new technology as we had hoped. The first product was also more complicated to administer. The new product is simpler, both due to our simpler design and to the better ease of access to the bladder, and could possibly even be administered by a nurse. Both products are intended for the same customers who already know UroGen. We plan to work with patient groups, and they have more of a voice when the market consists of 80,000 patients, versus a few thousands".

On the private placement Barrett said, "The biotech market is tough. Not every company that published results lately, saw their stock go up and was able to raise money based on the results. We were lucky to have the investor approach us with a very strong term sheet. The money we raised will be used for completion of the clinical trial and for the launch".

Does UroGen see itself as an Israeli company?

"Whenever I present the company I say right off that it is originally an Israeli company and that it has an R&D center in Israel. About a third of our investors are Israeli. We have not felt any pressure from our other investors to weaken our ties with Israel.

Published by Globes, Israel business news - en.globes.co.il - on July 30, 2023.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2023.

UroGen credit: Tali Bogdansky
UroGen credit: Tali Bogdansky
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