Legend Biotech CEO Ying Huang, Ph.D., already had a lot on his plate when speculations of a potential geopolitical crackdown and the option of a buyout emerged.
The company’s CAR-T therapy Carvykti, partnered with Johnson & Johnson, is starting a key launch in second-line multiple myeloma, as the two partners are busy expanding capacity at multiple manufacturing sites simultaneously.
But lawmakers on the Congress’s Select Committee on the Chinese Communist Party recently requested an intelligence briefing on GenScript, which is Legend’s largest shareholder and former parent. And the inquiry included Legend, raising fears of a potential BIOSECURE Act-like crackdown.
Just as that risk clouds over Legend, a report in July suggested the company had received a takeover bid and had tapped Centerview Partners as a financial adviser to review its options.
“I would like to assure you that our board and management team have been taking a close look at our business to ensure we are best-positioned to continue our growth momentum as we advance our mission to help multiple myeloma patients,” Huang said Friday during Legend’s second-quarter earnings call.
“We know there has been recent speculation about potential political risk, particularly given this being an election year; our board is active and engaged and continues to assess the potential impact of those risks,” he added.
Legend has evaluated the draft BIOSECURE Act, which currently targets several CDMOs and gene sequencing service providers with ties to China and it has been engaging with the Committee and the House Speaker’s office, he added.
“At this point, we do not believe there will be any direct impact to Legend, given how our operation model is and how, in terms of data and also IP flow, we conduct the business,” Huang said. “So, suffice to say that we’re not too concerned that we’re the target of the BIOSECURE bill.”
As to a potential buyout, Huang pointed to Legend’s years as a public company and the many milestones it has reached so far.
“We certainly believe that there’s a lot of growth ahead of us, and we remain confident in our current long-term strategy to realize the full potential of Carvykti and also advance our pipeline as we continue to develop innovative treatment options,” Huang said.
Still, Legend’s board is speaking with investors and other stakeholders, Huang said, noting that there’s more than one way to maximize shareholder value.
All these evaluations and discussions are happening as Legend and J&J roll out Carvykti in earlier treatment of myeloma following April approvals from the FDA and the European Commission.
During the second quarter, Carvykti sales reached $186 million. Although the number marks an 18.5% sequential growth compared with the first three months of 2024, it’s far from the inflection point that J&J and Legend have promised.
The two companies have orders waiting to be fulfilled at their manufacturing site in Raritan, New Jersey, and Carvykti has “a queue in all the major hospital centers today for second line,” Huang said. About 50% to 60% of the new patient orders are from the new approval in earlier lines of treatment, he said. These patients have just entered Carvykti’s portal for scheduling and were therefore not reflected in sales yet.
J&J and Legend recently announced that Carvykti has also shown a statistically significant and clinically meaningful overall survival benefit in the CARTITUDE-4 trial that supported its earlier-line approval. The pair plan to submit the results to the FDA and EMA to include the results in Carvykti’s label, which Huang said will be “a very powerful tool in the promotion” of Carvykti.
With the demand, Huang said the company expects “pronounced growth” for Carvykti in the second half of 2024 and is looking beyond this year for further manufacturing expansions.
“We are being creative here,” Huang added. “And we and J&J are trying to think out of the box in terms of finding the future—supply that includes internal nodes, construction of greenfield or brownfield or alternative other routes. I can assure you that that is one of the highest priorities for the partnership.”
J&J and Legend recently tapped Novartis to help make Carvykti. And the Swiss pharma just started clinical production last month at its Morris Plains, New Jersey plant. Legend expects the contractor could free up resources for commercial production at its own site over the next few months.
Pending FDA approval, Novartis is also expected to start producing commercial Carvykti in the first half of 2025 and so is clinical production at Legend’s Ghent site in Belgium. Later that year, the Ghent site could start commercial output and a physical expansion of the Raritan facility could gain regulatory approval, according to Huang.
Carvykti has been pressuring Bristol Myers Squibb’s rival CAR-T Abecma. But BMS’ partner, 2seventy bio, on Wednesday reported a renewed interest in Abecma at large academic treatment centers following a third-line approval from the FDA in April. Leerink Partners analysts saw that as a sign that Abecma may have a window to solidify its position given the drug’s differentiated safety profile on Parkinsonism-related neurotoxicity and as J&J and Legend are still scaling up manufacturing.
Meanwhile, on the clinical front, the CARTITUDE-5 trial for Carvykti in newly diagnosed myeloma patients for whom stem cell transplant is not planned recently complete enrollment. Together with the CARTITUDE-6 study in transplant-eligible patients, Legend sees an additional 52,000 patients that could be eligible for Caryvkti per year.
As of the end of June, Legend had about $1.3 billion in cash, deposits and investments. It expects to achieve an operating profile in 2026.