It’s not often that you’ll find a company with six cancer drugs in clinical trials that have their own companion diagnostics, and an in-house drug discovery engine. So why all the skepticism surrounding Merrimack Pharmaceuticals?
After going public in March 2012 at $7 a share, Cambridge, MA-based Merrimack (NASDAQ: [[ticker:MACK]]) still has a lot to prove to investors. Shares trade at roughly $5 apiece, have never gone far north of $11, and have slumped during a year in which the Nasdaq Biotech Index as a whole has jumped 28 percent.
Merrimack hopes to deliver the kind of results its long-term backers have been counting on. By the fall, Merrimack will wrap up four separate mid-stage clinical trials on a cancer drug known as MM-121, which it licensed to Sanofi in 2009 and is now being tested in patients with breast cancer, ovarian cancer, and lung cancer. It will also unveil the results of a 405-patient late-stage study on MM-398, a nanotherapeutic Merrimack is testing in patients with pancreatic cancer whose condition has worsened after prior therapies. If one or more of those trials succeed, then Merrimack will have some evidence to suggest it’s on the right track with its drug discovery approach that leans heavily on computer models; companion diagnostics; and small patient populations with well-defined molecular abnormalities.
Should Merrimack back up that plan with some eye-opening data, investors might look Merrimack in a different light.
“The good news is, there are a bunch of cards getting turned over this fall,” says Merrimack president and CEO Robert Mulroy. “But [that’s] really just the beginning of the wave of opportunities for us that can create the kind of returns investors are hoping for, and that we’re hoping for.”
Merrimack was founded by scientists at Harvard University and the Massachusetts Institute of Technology in 2000 around a technology called a high-density protein array, a way to measure the interactions between proteins over time. Think of it as a movie that captures how proteins interact with one another. Merrimack takes the data from that movie and makes an interactive computer model from it that researchers can play with to figure out things such as what target to attack, or what type of drug they should add (an antibody or small molecule, for instance). Researchers can then design that drug and test a simulated version of it in the computer model to predict how it would behave in a cell. Merrimack then goes and builds it into a real therapeutic. The idea is that the system is a more efficient, accurate—and more importantly, far less costly—way to find a productive drug.
“We design that drug, simulate it, and then go build that drug, as opposed to screening millions of compounds against a potential target and then reverse-engineering why it might be working, which is sort of today’s model,” Mulroy says.
Merrimack’s plans are ambitious: it views itself as an emerging drugmaking factory whose technology can be used to churn out products in any therapeutic category, though it has chosen to keep its focus on cancer. Merrimack recently
