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Mustang Bio’s (NASDAQ: MBIO) shares rose by almost 250% after its development partner, St Jude Children’s Research Hospital in Memphis, published study results that demonstrated that its experimental gene therapy could cure “Bubble Boy” disease or X-SCID, a severe combined immunodeficiency in infants.

Figure 1 – Stock Price

Mustang Bio (NASDAQ: MBIO), a clinical stage biotechnology company engaged in developing path-breaking cell and gene therapy for unmet medical needs in the fields of hematologic cancers, glioblastoma and rare genetic diseases acquired the therapy through a licensing agreement in August 2018 from St. Jude Children’s Research Hospital.


Severe combined immunodeficiency (SCID), a rare genetic disorder caused by gene mutations that inhibit the functioning of immune cells, had no cure hitherto. Children afflicted with this condition are healthy in appearance but are susceptible to severe infections, even a common cold can prove fatal, so they live in isolation under constant monitoring and surveillance, leading to a very poor quality of life.

This condition affects about 1 in 100,000 to 200,000 live births in the US. A report by Transparency Market Research estimates that the primary immunodeficiency disease market will reach US $7.5 billion by 2023 growing at CAGR of 6.1%. The market was worth US $4.36 billion in 2014.

Advancements in new born screening tests now allow gene defects to be identified at the nascent stage; however, in an estimated 15 percent of the cases gene defects are still unknown according to a NIH-sponsored study. X-SCID is caused by the mutation of a gene in the X chromosome and usually manifests in male infants causing abnormal growth of white blood cells and result in non-existent B-Cell functioning and a very low count of T-cells. In fact, the absence of T cell receptor excision circles (TRECs) is a criterion for evaluating SCID.

Early detection of SCID is associated with better treatment and higher survival rates.


However, with no cure in sight, the treatment options were limited to Hematopoietic (blood-forming) stem cell transplantation, antibiotic therapy, stem-cell transfer, gene therapy and enzyme therapy.  These treatments have severe limitations as it is not easy to find a bone marrow donor or the perfect match, with transplants done within the first 3.5 months of life being the most successful in terms of survival leaving a very narrow window of opportunity. Even then they do not restore full immunity.

Earlier attempts at using gene therapy for treating X-SCID exhibited a very alarming side effect, with patients developing leukaemia, most likely caused by the vectors that transplant cells.


X-linked severe combined immunodeficiency (XSCID) affects 1-2 infants per 100,000 births and hence is categorized as a rare genetic disorder. Mustang Bio (NASDAQ: MBIO) in association with St. Jude Children’s Research Hospital has developed a safety modified lentiviral (LV) vector that is to be used in conjunction with reduced-exposure busulfan conditioning for infants afflicted by X-SCID. The addition of low-dose busulfan not only helps ready the bone marrow for engraftment but also promotes B cell reconstitution.

Image Source: Mustang Bio

Mustang Bio (NASDAQ: MBIO) is presently engaged in two clinical trials. The first one is in collaboration with St.Jude’s, which is a Phase I/II gene therapy study through which 10 infants with X-SCID aged between 2 to 13 months at the time of treatment were successfully treated, with significant improvement in T cell count and B cell function. The results also show that 6 out of the 8 infants achieved reconstituted immune systems within 10 months of treatment and further 4 of the 6 patients did not need monthly administration of IVIG. Also no infants developed leukaemia yet as a result of the treatment.

The second clinical trial is also a Phase I/II study but for children older than 2 years which is being sponsored by National Institute of Health (NIH). The trial which was initiated in 2011 has treated 5 patients between the ages of 10 to 23, who have demonstrated evidence of restored T-cell immunity along with T, B, NK and myeloid cells. Three of these patients have shown immune system reconstitution and production of antibodies post vaccination, in addition, to reduced viral infections and improved protein absorption.

The procedure used is similar to CAR-T cell therapy, which is Mustang’s area of expertise.

Image Source: Mustang Bio

The company’s strategy is to acquire licenses for clinical CAR T programs and Gene Therapy programs that show great potential in addition to being a match to its capabilities in CAR T processing.

In addition to MB-107, its X-SCID Gene Therapy program, it is also developing CD-123 or MB-102 and adaptive cellular immunotherapy in AML and BPDCN, a form of rare aggressive blood cancer. Its CD20 or MB-106 is an Immunotherapy program for B-Cell Non-Hodgkin Lymphoma. Additionally it is also developing CS1 or MB-104  Multiple Myeloma, IL-13Rα2 or MB-101 for the treatment of Glioblastoma (GBM), HER2 or MB-103 for Glioblastoma Multiforme, PSCA or MB-105, a prostate stem cell antigen for prostate, pancreatic, gastric & bladder cancers and C134 or MB-108 a next-generation oncolytic herpes simplex virus (“oHSV”).


We feel that the company is likely to face major challenges before it can successfully commercialize MB-107.  Though it is being hailed as a major breakthrough, the long-term impact of the therapy is yet to be studied. The incidences of X-SCID are only about 20 new patients per year in the U.S as far as infants are concerned. It will be keenly watching the NIH sponsored study of patients over 2 years of age which accounts for about 400 new diagnoses each year. The company is likely to combine the data from both the trials into a single submission and apply for a Biologics License Application (BLA) in mid-2022.

Another challenge that the company will face is the commercial manufacturing aspect. So far St.Jude’s has been the one producing the therapy at its own facility; the company is expected to take over by the end of 2019. Though it has a 27,000-square-foot cell-processing facility in Worcester, Massachusetts, it is yet to acquire a FDA clearance. In addition, it also has to source the viral-vectors used for the therapy which are prohibitively expensive and have a long wait list.

The company is planning to conduct a smaller study with 3 to 4 patients to prove its manufacturing capabilities. However, a major concern for the company is the financial wherewithal to fund commercialization. The company reported about $20 million in cash and cash equivalents as of December 31, 2018 as per its financial results. The company announced a $20 million venture debt financing agreement with Horizon technology finance in April 2019 which might help fund its efforts for the time being.


Mustang Bio (NASDAQ: MBIO) is a subsidiary of Fortress Bio (NASDAQ: FBIO) that was formed in 2015. This clinical stage biotechnology company is focused on creating cutting-edge therapies for the treatment of rare genetic diseases, solid tumours and hematologic cancers using its proprietary chimeric antigen receptor (CAR) engineered T cell (CAR T) therapies. It aims to create strategic partnerships and alliances in order to acquire novel therapies by means of licensing, ownership interest for funding the research, development and commercialization aspects.

Besides St.Jude’s the company has active collaborations with Harvard for Engineering T-cells utilizing CRISPR/Cas9, research collaboration with City of Hope for optimizing CAR T cell processing procedures, Fred Hutch for coordinated use of CAR T therapies and Nationwide Children’s to develop a oncolytic virus (C134) for glioblastoma multiforme.


Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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