Several very smart biotechnology investors, doctors, and analysts turned my attention to Trillium Therapeutics, Inc (TRIL) this year.

We initially started buying the stock in the $8 range, when the company’s cash was about $6/share. Some very focused biotech investors felt the CD47 immune oncology opportunity Trillium represents could be a best in class solution in the rapidly growing immune oncology space.

Over the last century, cancer treatment has evolved from surgically removing cancers to radiation treatment and chemotherapy. Leading edge research suggests that molecular strategies which turn the body’s own immune system against the cancer itself is the newest and most exciting area in the treatment of cancer today. See NY Times article below.

This sector has been red hot this year with multiple buyouts in this space. Large pharmaceutical companies are looking at promising immune oncology companies to acquire the technology for tomorrow’s wonder cancer drugs. Trillium rose to $17 this year, though it had traded to $30 last year before biotech stocks turned south in part due to the expectation that a Clinton presidency would lead to price controls on drugs which would undermine the economic return prospects of companies involved in early stage and leading edge drug development.

Trillium’s TTI-621 reported early phase one clinical data on November 4th, which, at first glance, appeared disappointing and prompted a 55% decline in the stock. What the data revealed is that the highest dosage level of 3mg/kg produced levels of toxicity, primarily reduced platelets in the blood. The primary cancers that Trillium is targeting in this phase one are blood borne cancers. However, reduced platelet activity is also a sign of the drug showing activity and possibly efficacy. In fact, while the market’s initial negative reaction to the toxicity reported at the highest 3mg/kh level dose, the 2mg/kg dose level appeared to work safely and possibly effectively.

The current trial data will be expanded on December 4-6 at the American Society of Hematology (ASH). In the simplest terms, if this data shows more patients tolerating the drug and remaining stable (within the context of terminal cancer) Trillium should rise and potentially trade in the $10-17/share level. In this case, the Trillium would likely be used with other oncology drugs as part of a potential cocktail cancer treatment. If the data demonstrate some patients seeing a remission or reduction in their cancer, the stock could rise significantly, as the prospect for it being used as a standalone drug (potentially worth $billions) becomes an increasingly real prospect.

Of course, the data could show negative or disappointing results, which would likely lead to the stock to trade in the $4-7/share range.

Beyond the smart professionals I know who see a big potential for Trillium and its cd47 technology, the following comments from the President of Celgene is a powerful endorsement from one of the top people in the Immune Oncology space. Mark Alles, the president of Celgene (CELG) wrote this on twitter June 10th, 2016:

“I think the other thing that might be interesting and we’re being careful about how we talk about it, but it’s our CD47 our anti-CD47 antibody, which interacts and takes the breaks off of or another way to say it allows macrofisers [ph] in a human being to identify solid tumor much the way the checkpoint inhibitors did this with respect to the PD-1, PDL-1 access.

And so if we were able to move this through the clinic we would be able to interact and trigger a completely different side of immunology and we think it’s going to be quite effective, the big question someday is could we combine a CD47 antibody with a T-cell checkpoint inhibitor and now you have a T-cell activated immune system with macrofisers coming in as well and holy grail there would be that it would be safe and effective I think that would be a very powerful in the future to try to treat cancer.

That said, we’re still in Phase 1, we’re being cautious because we know it’s going to be highly effective, we’ve got to be careful about the toxicity profile. So CD47 I think is something that is probably not on the radar, but it is our disruptive differentiated way to come in and really add to the space”
Competition: Celgene (CELG), Forty-Seven Inc (led by Stanford oncology guru Dr. Irv Weissman and funded by Google Ventures and other top tier VCs), and Trillium are the three CD47 companies pursuing this immune oncology pathway. Celgene and Forty Seven Inc have two phase one studies and Trillium has one. My contacts and the author of the report below suggest that TTI-621 is possibly the best in class.

I defer to the research report below to elaborate on this data analysis. However, it appears that there was an over-reaction to the initial data, and that the potential for Trillium and TTI-621 is enormous. While Trillium remains a stock with real downside risk, the upside potential is enormous and represents an attractive asymmetric risk reward opportunity, in our opinion.

Tyson Halsey, CFA

From: Bloom Burton Equity Research <>
Date: November 14, 2016 at 9:55:47 AM EST
Subject: Trillium Therapeutics Inc. (NASDAQ:TRIL, US$8.00; TSX:TR, C$10.81). Forty Seven’s Hu5F9-G4 Continues to Underwhelm as Monotherapy. Science, Risk/Reward Still Favor TRIL – Spec BUY if TRIL Sells.


David Martin PhD MBA
Bloom Burton & Co. Ltd. | 65 Front Street East, Suite 300, Toronto, Ontario, M5E 1B5 | T: 416-642-8865 | |

Trillium Therapeutics Inc. (NASDAQ: TRIL, TSX: TR) Target Price: US$18.00 – BUY, Speculative Risk

Forty Seven’s Hu5F9-G4 Continues to Underwhelm as Monotherapy. Science, Risk/Reward Still Favor TRIL – Spec BUY if TRIL Sells.

 The full comment can be found at:

In advance of the ASH Conference (December 3-6) which we believe will be important for Trillium, Trillium reported low impact correlative data at the Society of Immunotherapy for Cancer (SITC) conference held in National Harbour, MD over the weekend. Competitor, Forty Seven Inc. (private) reported a more important update of its phase 1 clinical trial of anti-CD47 mAb, Hu5F9-G4, in patients with solid tumors (a leukemia study is currently also underway).


 Forty Seven reported safety (n=26) and efficacy (n=20) results that are incremental to results (n=19) reported at ASCO in June (

Six patients in Forty Seven’s phase 1 trial have now achieved stable disease (up from two at ASCO) which is potentially promising, but we believe investors and the medical community are looking for disease regressions to really validate CD47 blockade. Forty Seven’s highest dose cohort (1 mg/kg priming followed by 20 mg/kg maintenance) is in early innings, which opens the window for responses at subsequent readouts, but two Grade 4 liver enzyme SAEs reported at 1+20 may result in an MTD of 1+10. Transient Grade 1 and 2 anemia continues to be observed in patients treated with Hu5F9-G4 (6 of 11 patients who received priming doses) due to its binding to red blood cells, although the anemia appears to be clinically manageable.

In our opinion, while the new Hu5F9-G4 data are not positive, they are also not negative for Trillium – we continue to believe that TTI-621 will prove to be more potent and safe compared to Hu5F9-G4 since the Trillium drug contains an IgG1 effector region. Because of the IgG1, TTI-621 both blocks CD47 (which activates macrophage phagocytosis (eating) of cancer cells), and it also stimulates ADCC-mediated killing of cancer cells, all the while avoiding binding to and destroying red blood cells. Therefore, we view the new muted Hu5F9-G4 results as continued validation that what we are seeing, is what the science has predicted.

Regarding TTI-621 itself, as we noted in our November 4 report following publication of Trillium’s ASH abstract (poster to be presented December 3:, at comparatively low doses (0.05, 0.1 and 0.3 mg/kg), TTI-621 caused dose dependent and aggressive clearance of platelets (up to 90%) which we viewed a proxy for anti-cancer effect since both platelets and cancer cells express CD47, and cancer cells express additional “eat me” signals. We do not believe that any of the five patients in Trillium’s phase 1a high dose cohort had been on trial long enough to be evaluable for disease response.

At ASH, investors should see the first tumor evaluations for the high dose patients (two patients at lower doses had stable disease as of the abstract cut-off date, July 28), as well as early data for an expanded cohort that may contain up to 10 additional patients dosed at 0.2 mg/kg.

We view the updated Forty Seven data as “consistent with the science”, and a continuation of results reported by the company earlier this year at ASCO. Therefore the impact should be largely priced-in to TRIL stock. Maintaining BUY rating (Speculative Risk); Target price: US$18.00.