Nobody will accuse Cytokinetics of being an "overnight success," Chief Executive Robert Blum says. But CYTK stock is trading with enthusiasm as the biotech approaches what was once a moonshot goal.
The company launched close to 25 years ago after researchers at two University of California campuses identified a protein involved in muscle contraction. In December, a Food and Drug Administration panel of experts will consider the first of Cytokinetics' drugs to be produced from that research with the goal of correcting the underlying cause of heart failure.
Cytokinetics has two drugs in development that target myosin, a protein responsible for converting chemical energy into the mechanical force behind muscle contraction. One drug would activate myosin, while the other would block it. And both can be useful in treating how muscle movement affects the heart.
Cytokinetics also is testing a treatment for amyotrophic lateral sclerosis, or ALS. The condition, also known as Lou Gehrig's disease, causes progressive muscle weakness.
Recently, the furor sent CYTK stock to its highest point since 2007. Blum says Cytokinetics needed "resourcefulness, resilience and creativity" to survive nearly two decades of research and development.
"Most biotech companies fail and even those that succeed are representative of a binary outcome," Blum told Investor's Business Daily. "We took the long way to get here. We've been committed for many years to building out this one area of biology which can ultimately become a new pharmacology."
CYTK Stock: Elegant Biology
There's an elegance to the biology behind Cytokinetics' experimental drugs, according to Blum.
The company is using a drug called omecamtiv mecarbil to activate myosin in patients with failing hearts and reduced ejection fraction, the latter of which occurs when the heart's left ventricle is pumping less blood than the body needs. By activating myosin, Cytokinetics hopes to strengthen a patient's weak heart muscles.
In a 2020 paper posted in the Journal of the American Medical Association, researchers estimated half of the 23 million patients worldwide who suffer from potential heart failure fall into this category.
FDA experts will meet in December to discuss the benefits and risks of omecamtiv mecarbil. At the end of the advisory committee meeting, they will make a nonbinding recommendation to the full agency. The FDA is set to make a decision about the heart drug in February.
But CYTK stock investors seem most excited about the myosin inhibitor, dubbed aficamten. Cytokinetics developed this drug for patients with hypertrophic cardiomyopathies. In this case, myosin is working too hard, leading to hyper-contraction. As a result, the heart thickens and stiffens. That eventually limits the heart's ability to pump blood.
Aficamten is in Phase 3 testing. The results of that study are expected in 2023. So far, though, aficamten appears to compare favorably with Bristol Myers Squibb's cardiac myosin inhibitor, Camzyos. CYTK stock plunged more than 6% on Oct. 26, however, after Bristol reported $5 million in third-quarter Camzyos sales, lagging expectations for $19 million.
"Camzyos early launch is slowed by onerous (safety monitoring) requirement, which we believe will be absent from Cytokinetics' aficamten," UBS analyst Ashwani Verma said in a note to clients. "While Bristol has to carve out the hypertrophic cardiomyopathy market, Cytokinetics has a second-mover advantage."
Rivaling Bristol Myers In Heart Medication
It's no wonder Cytokinetics believes aficamten can show up Camzyos.
Cytokinetics helped launch a company called MyoKardia in 2012 with $38 million in funding from Third Rock Ventures. At the time, the companies collaborated on research. Two years ago, Bristol Myers put up $13.1 billion to acquire MyoKardia. Camzyos, formerly known as mavacamten, gained FDA approval last April.
In the final-phase test, 37% of patients who received Camzyos showed improvements in exercise capacity and symptoms. In comparison, just 17% of placebo recipients improved.
Aficamten has completed midstage testing. After 10 weeks of treatment, patients showed statistically significant reductions in the amount of blood their left ventricles pumped while resting. Patients in the treatment group also showed improvements in symptoms.
Hypertrophic cardiomyopathy affects an estimated one in 500 people, according to the American Heart Association. Roughly two-thirds of those have an obstructive form of the disease and are more likely to experience symptoms.
Blum acknowledges some CYTK stock investors are watching for a possible Cytokinetics buyout after Bristol Myers spent north of $13 billion to acquire MyoKardia for an asset similar to aficamten. But after more than two decades, that's not at the front of his mind.
"Our goal is to advance a pipeline and a portfolio of drug candidates, such that we can build a more independent and autonomous business," he said. "And that could also be in the interest of shareholders."
Activating Another Protein In ALS
Cytokinetics hopes to launch omecamtiv mecarbil and aficamten, along with a third drug dubbed reldesemtiv, over the next three years. Reldesemtiv is in testing for amyotrophic lateral sclerosis, or ALS. It activates troponin, a protein that works alongside myosin, in muscle contraction. It could activate the fast-twitch muscles often impacted by ALS.
"By activating that protein, it's increasing muscle force and power, and extending the time to muscle fatigue," he said. "In other words, (it's) increasing muscle endurance, which is really an entirely novel way of looking at ALS."
Other drugs in development for ALS treatment aim to slow the loss of neurons associated with the disease. Earlier this month, an independent committee reviewed study data and said an ongoing Phase 3 study of Cytokinetics' ALS drug could continue.
"By activating fast-twitch skeletal muscle, the hypothesis is we would be able to slow the decline of loss of function and thereby enhance quality of life for longer," he said. The theory could also pan out for other neurodegenerative diseases that impact muscle function, like Duchenne muscular dystrophy, he says.
CYTK Stock And Competitive Areas
Blum knows the areas Cytokinetics is entering are competitive. In addition to rivaling Bristol's Camzyos, Cytokinetics is entering a market where Merck has long been a leader. Further, Merck is pumping up its cardiovascular business with the hopes of garnering $10 billion in annual sales by the mid-2030s.
In patients suffering from potential heart failure, Blum says Cytokinetics is going after a smaller, more specialized population. Cytokinetics hopes to add its drugs to standard medicines, while new drugs from Novartis, AstraZeneca and Merck address the secondary consequences of heart failure.
Meanwhile, ALS treatments are grabbing recent attention with an approval for Amylyx Pharmaceuticals. But the disease is still woefully undertreated. Many patients succumb to the disorder within a couple of years. Blum estimates there are 25,000 patients in the U.S. at any point.
A Big-Name Biotech?
Ultimately, Blum hopes Cytokinetics will land itself among the biggest biotech names: Regeneron Pharmaceuticals, Amgen or Vertex Pharmaceuticals. These companies have built long-standing franchises in areas of science and commercialization.
CYTK stock investors are certainly paying attention. Shares have a strong Relative Strength Rating of 96 out of a best-possible 99, according to IBD Digital. This puts Cytokinetics stock in the top 4% of all stocks in terms of 12-month performance.
"We have a balance sheet that distinguishes Cytokinetics from nearly all of our peer group of companies; our company has upward of $1 million in cash, representing over two years of forward cash runway," Blum said. "We also have a pipeline that represents redundancy in the science and mitigation of risk."
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
