We are initiating coverage on Sierra Oncology Inc (NASDAQ:SRRA), a drug developer targeting the DNA damage response (DDR) network to treat cancer. The company has two Phase I trials with SRA737 targeting checkpoint kinase 1 (Chk1) in patients with genetic tumor types expected to respond to the drug. Inhibition of Chk1 is lethal in cells with defective p53 (among others), one of the most common cancer mutations, and also enhances the response to chemotherapy. Sierra also has the cell division cycle 7 (Cdc7) inhibitor SRA141 in preclinical testing. Our initial valuation is $206m or $3.95/share.
DDR: A network with validated anti-tumor targets
The potential of therapies attacking the DDR network has recently been validated, with the approval of poly-ADP-ribose polymerase (PARP) inhibitors. For instance, Lynparza (olaparib, AstraZeneca), approved in 2014 for ovarian cancer, had $218m sales in 2016, but these are expected to increase substantially with approval for breast cancer. SRA737 and SRA141 both target other proteins in the DDR network.
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