argenx: llamas, antibodies and exciting growth prospects

October 2023 / 4 minutes

Key points

  • argenx is a global pharmaceutical company developing antibody-based therapies for autoimmune diseases
  • It collaborates with academics to create effective teams and build strong partnerships
  • Its first commercial product, VYVGART, treats one chronic neuromuscular disease and could be a potential treatment for others

A collaborative approach

Founded in Belgium 15 years ago, argenx has grown to become a global biopharmaceutical company that focuses on developing and commercialising innovative antibody-based therapies for the treatment of severe autoimmune diseases.

Named after the collaborative work demonstrated by Jason and his Argonauts, famed in Greek mythology, argenx has a partnership-based approach to drug discovery. Leveraging its core skill set of antibody engineering, the company has established a broad range of academic partnerships and seeks innovation and biological insights in many different places.

argenx’s strategy is to identify those research groups that are genuine thought-leaders in the field, engage with them, learn about their work, build partnerships with those academic groups, and start developing drugs together.

It works closely with academic collaborators, creating multidisciplinary teams that include both argenx employees and academics to further its knowledge. It gets involved in programmes at a very early stage to help de-risk each project.


Platform technology

argenx utilises a unique antibody discovery platform that helps to identify and develop antibodies that target specific disease-causing proteins, harnessing the power of the immune system.

The process starts with the immunisation of llamas with a target protein. Llamas have a unique immune system, and using them as a source of antibodies offers advantages in terms of greater antibody diversity, including those that humans typically do not possess. Llama-derived antibodies are also similar enough to human antibodies to reduce the number of further modifications required and increase the chances of succeeding in developing a safe and effective drug.

Once the animals have been immunised, argenx extracts peripheral blood cells and isolates the genetic material responsible for antibody production. This genetic material is then used to generate large and diverse libraries of antibodies. This allows argenx to access and explore a broad antibody universe while reducing the long timelines associated with traditional methods.

Once an antibody of interest has been identified, a lot of work is then needed to modify it into a drug product. argenx has a range of technologies to design drugs that are suitable in terms of safety, efficacy, and patient convenience.

Scalable success

Building on the pioneering work of Professor Sally Ward at The University of Texas Southwestern on identifying the importance of the Fc receptor in the regulation of our immune systems, argenx collaborated with her group to develop its first commercial product, VYVGART. This first-in-class therapy has the potential to treat a broad range of autoantibody-medicated diseases by targeting the Fc receptor.

VYVGART launched in 2021 and is already annualising at over $1bn in sales for the treatment of one autoantibody-mediated disease, generalised myasthenia gravis (gMG). A chronic autoimmune neuromuscular disease, gMG causes weakness in the muscles, typically beginning around the eyes and eyelids, and then progressing to other parts of the body. For VYVGART, gMG is just the beginning. There are over 100 autoimmune diseases for which VYVGART may be a potential treatment option.

Recently, argenx reached another crucial milestone with a home-run Phase 3 clinical trial outcome for VYVGART in chronic inflammatory demyelinating polyneuropathy, or CIDP. CIDP is a neurological disorder where the immune system targets the body’s nerves and involves progressive weakness and reduced arm and leg senses.

Before the trial results, there was a general assumption that VYVGART would be suitable for around 40 per cent of CIDP patients and, therefore, the market would be limited. However, the trial demonstrated that it is suitable for the majority of cases, significantly broadening the market opportunity. argenx will likely dominate the treatment landscape in CIDP and displace the current treatment options, which are associated with significant drawbacks.

Many autoimmune diseases have no current treatment options and are massively debilitating for sufferers, reducing life expectancy in many cases. The majority of them are classified as rare diseases. In the US, this is defined as a disease affecting fewer than 200,000 people.

From a commercial perspective, this means the capability required to successfully promote new product launches requires only limited sales and marketing investment, as only a small number of prescribers manage these patient populations. Reimbursement for products designed to treat rare diseases is typically high to incentivise the development of drugs to treat unmet clinical needs.

Given the broad applications of VYVGART, argenx is having to prioritise which of these diseases it develops a treatment for next. The criteria are understanding the biology of each disease first, then the clinical unmet need and the commercial opportunities.

Management aims to have VYVGART either commercially available or in clinical development for 15 indications by 2025. We expect this number will continue to increase over time. Not all indications have the potential to generate $1bn in revenue, but the potential for VYVGART to be the biggest-selling drug for autoimmune disease is very real. It could become the biggest-selling drug of all time.


A position of strength

argenx has already created significant value for shareholders with the successful delivery of its first commercial asset. With high-margin revenues, healthy operating cash flow growth, and a robust balance sheet, argenx is investing in its future growth prospects from a position of strength. Following a recent $1.1bn equity capital raise, management now has $3bn to deploy, allowing it to accelerate investments in both product pipeline assets and commercial capabilities.

Beyond VYVGART, argenx is already developing its next two products, both targeting different areas of biology. Both of these assets are already in clinical development, with further proof of concept studies due to start later this year.

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