News

< Back to News

CNCR ETF Rebalance – June 2020

Jun. 16, 2020

June 16 marked the semi-annual rebalance and reconstitution of the Cancer Immunotherapy ETF’s (Nasdaq: CNCR) underlying index. This happens in two steps. First, a committee of advisors that oversees the index gets together and determines the reconstitution, which means they decide if any new companies should be added. Second, once the index’s holdings have been finalized, a rebalance occurs and each company is given equal weight. CNCR ETF then places trades to replicate those changes as closely as possible. View all holdings of the Cancer Immunotherapy ETF.

In addition, the Committee has chosen during this meeting to increase the target number of index components to 30 from 25. This change reflects the committee’s belief that the science of immunotherapy is strengthening and the pool of quality available companies is growing. The committee has been encouraged to see recent data releases in areas such as bi-specific antibodies, allogenic CAR-T, CD47, cytokines, oncolytic viruses, TIGIT, and others.

For the June meeting, the committee has added nine new immunotherapy companies. They are Adaptimmune (Nasdaq: ADAP), Arcus Biosciences (NYSE: RCUS), Compugen (Nasdaq: CGEN), Cue Biopharma (Nasdaq, CUE), IGM Biosciences (Nasdaq: IGMS), Legend Biotech (Nasdaq: LEGN), MacroGenics (Nasdaq: MGNX), Replimmune (Nasdaq: REPL), and Trillium Therapeutics (Nasdaq: TRIL).

These companies replace Atara Biothearpeutics (Nadaq: ATRA), Autolus Therapeutics (Nasdaq: AUTL), Precision Biosciences (Nasdaq: DTIL), and Ziopharm Oncology (Nasdaq: ZIOP).

Brad Loncar, CEO of Loncar Investments and Chairman of the Index Committee, had the following comments, "Our decision to increase the index’s number of components during this period is based on our committee's positive opinion of the progress being made in immunotherapy science. We are pleased to support this expanded field of companies as they aim to deliver new innovations for patients."

text

Adaptimmune (Nasdaq: ADAP)

Adaptimmune is known for being a leader in the T-cell receptor (TCR) cell therapy space. At the beginning of 2020, the company announced that they have seen initial responses in four types of solid tumors using their SPEAR T-cell platform. These were hepatocellular carcinoma, metastatic rectal mucosal melanoma, metastatic gastroesophageal junction cancer, and head & neck cancer. More recently at the 2020 ASCO cancer conference, Adaptimmune presented new responses in metastatic gastroesophageal junction cancer, lung, and head & neck cancer. The company also signed a partnership with Japan’s Astellas to co-develop and co-commercialize stem cell derived allogeneic CAR-T and TCR T-cell therapies.

text
Arcus Biosciences (NYSE: RCUS)

Arcus made headlines in May when it signed a 10-year partnership with Gilead to co-develop and co-commercialize next-generation cancer immunotherapies. Gilead paid Arcus $175 million up front, made a $200 million equity investment in the company, and Arcus is eligible to receive up to $1.225 billion in opt-in and milestone payments in regard to clinical product candidates. Arcus is currently developing a dual adenosine receptor antagonist, a CD73 inhibitor, an anti-TIGI antibody, and a PD-1 inhibitor.

text

Compugen (Nasdaq: CGEN)

Compugen’s three main imunotherapy drugs are a PVRIG inhibitor, an ILDR2 inhibitor, and a TIGIT inhibitor. It presented an update of an ongoing phase 1 study of the PVRIG inhibitor at the recent AACR cancer research conference earlier this year. The data showed partial responses both as monotherapy and in combination with Bristol-Myers Squibb’s PD-1 inhibitor Opdivo. A trial was also recently initiated to study PVRIG, TIGIT, and Opdivo as a triplet therapy. Compugen is also partnered with AstraZeneca to develop bi-specific antibodies, though those programs are at an earlier stage.

text

Cue Biopharma (Nasdaq: CUE)

Cue's lead immunotherapy drug is designed to stimulate the IL-2 receptor, which causes the growth and expansion of T-cells. We know this pathway has merit because the U.S. FDA approved an IL-2 drug over 20 years ago to treat melanoma. However, the drug can be very toxic and hard for patients to tolerate. Cue’s IL-2 approach is designed to activate tumor specific T-cells without activating T-cells throughout the rest of the body. If they are able to achieve this, it might improve the tolerability issues seen with current IL-2 medicines.

text

IGM Biosciences (Nasdaq: IGMS)

An immunoglobulin M (IgM) antibody is the type of antibody in your body that is first to appear in response to exposure to an antigen. IGM’s platform has been designed to create IgM antibodies with higher affinity and avidity than naturally occurring IgM antibodies. It is using the platform in a variety of settings. The lead program in a clinical trial is a T-cell engager (also called a bispecific antibody) that targets CD20 and CD3. The company also plans to file an IND (a request to FDA for approval to begin a study) for a Death Receptor 5 (DR5) antibody later this year and is also planning to develop a targeted cytokine that pairs IL-15 and PD-L1.

text

Legend Biotech (Nasdaq: LEGN)

Legend Biotech is a cell therapy company. It is most famous for the BCMA CAR-T it has developed. It is partnered with Johnson & Johnson (JNJ) on it. At the recent ASCO cancer conference, JNJ presented some very encouraging data from this. 100% of multiple myeloma patients responded to the CAR-T treatment and 25 of 29 had a complete response (a total absence of measurable cancer). Durability is always an important factor to watch with CAR-T treatments, and in this case the CAR-T showed an 86% progression free survival (PFS) rate at 9 months. This data encourages us that BCMA may be the next frontier in CAR-T after B-cell malignancies.

text

MacroGenics (Nasdaq: MGNX)

We will have to see if MacroGenics becomes a commercial stage company later this year. It has submitted an application for approval to FDA for its first drug, Margetuximab. FDA’s target decision date is December 18th, 2020. This drug targets HER2 positives cancers and is designed so that its Fc domain (the stem of the antibody) has improved interaction with the immune system. In addition, the company has a full pipeline of other immunotherapy drugs. Its B7-H7 targeting drug recently showed some encouraging responses in prostate cancer. MacroGenics also has many bi-specific antibodies using its DART platform including ones that garget PD-1xLAG-3, PD-1xCTLA-4, and CD123xCD3.

text

Replimune (Nasdaq: REPL)

Replimune is the first oncolytic virus company to be added to the Cancer Immunotherapy ETF. Oncolytic viruses are injected directly into tumors. The way it works is that the virus replicates inside the tumor and causes it to break down and die. This releases antigens that teach the immune system to attack that kind of tumor. Replimune’s viruses are also given genetic codes for specific proteins that are meant to enhance cancer cell killing. One of the main ideas behind this approach is that it is uniquely tailored to each patient’s cancer. On June 3rd, Replimune presented an update from its phase 2 trial cohorts in melanoma and non-melanoma skin cancers that the company says support its registration-directed clinical trials with the lead oncolytic virus.

text

Trillium Therapeutics (Nasdaq: TRIL)

Trillium Therapeutics is a CD47 company. CD47 has been called the “don’t eat me” signal for the immune system. It is thought that a stronger immune response to cancer can be elicited by blocking it. This is immunotherapy in its purest form because it is designed to allow the immune system to do what it should naturally do with a cancer. Headlines were made earlier this year when Gilead acquired another CD47 company for $5.7 billion. Trillium has two SIRPαFc fusion proteins in its pipeline meant to block CD47. The only difference between them is which human immunoglobulin the CD47 blocking part is linked to via the Fc region. Both of the drugs are currently in phase 1 dose escalation studies.

Thank you for your interest in the field of immunotherapy and the Cancer Immunotherapy ETF. Be sure to sign up for email alerts below if you would like to receive notification of other news, company interviews, and research that we publish from time to time.

Opinions expressed are those of the author, interviewee, or Funds and are subject to change, are not intended to be a forecast of future events, a guarantee of future results, nor investment advice. Fund holdings and allocations are subject to change at any time and should not be considered a recommendation to buy or sell any security. Astellas and Johnson & Johnson are not a holding of the fund or affiliated with the fund.


  • Loncar Funds
  • P.O Box 15072
  • Lenexa, KS 66285
  • +1 800-617-0004
  • Contact Us

CNCR Prospectus CHNA Prospectus

A basis point is a common unit of measure for interest rates and other percentages in finance. One basis point is equal to 1/100th of 1%, or 0.01% (0.0001).

The Loncar Cancer Immunotherapy Index is an index of 30 securities that have a strategic focus on the area of cancer immunotherapy, or harnessing the immune system to fight cancer. Quotes for the index can be found under the symbol “LCINDX” on the Bloomberg Professional service and other financial data providers. One may not directly invest in an index.

The Loncar China BioPharma Index is an index of 36 securities that have a strategic focus on advancing China’s biopharma industry. Quotes for the index can be found under the symbol “LCHINA” on the Bloomberg Professional service and other financial data providers. One may not directly invest in an index.

Holdings are subject to change.

The Hong Kong Stock Exchange (HKEX) is the primary stock exchange in the Hong Kong Special Administrative Region of China. Nasdaq is one of the primary stock exchanges in the United States.

Carefully consider the Fund’s investment objectives, risk factors, charges and expenses before investing. This and additional information can be found in the Fund’s prospectus, which may be obtained at www.loncarfunds.com. Read the prospectus carefully before investing.

Investing involves risk. Principal loss is possible. The fund may trade at a premium or discount to NAV. CNCR will invest in immunotherapy companies which are highly dependent on the development, procurement and marketing of drugs and the protection and exploitation of intellectual property rights. A company’s valuation can also be greatly affected if one of its products is proven or alleged to be unsafe, ineffective or unprofitable. The costs associated with developing new drugs can be significant, and the results are unpredictable. The process for obtaining regulatory approval by the U.S. Food and Drug Administration or other governmental regulatory authorities is long and costly and there can be no assurance that the necessary approvals with be obtained and maintained. The Fund may invest in foreign securities, which involve political, economic, currency risk, greater volatility, and differences in accounting methods. The Fund is non-diversified meaning it may concentrate its assets in fewer individual holdings than a diversified fund. Therefore, the Fund is more exposed to individual stock volatility than a diversified fund. The Fund invests in smaller companies, which may have more limited liquidity and greater volatility compared to larger companies. The Fund is not actively managed and may be affected by a general decline in market segments related to the index. The fund invests in securities included in, or representative of securities included in, the index, regardless of their investment merits. The performance of the fund may diverge from that of the Index and may experience tracking error to a greater extent than a fund that seeks to replicate an index. Shares are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. Brokerage commissions will reduce returns.

RISK FOR THE CHNA ETF: The biopharmaceutical industry in China is strictly regulated and changes in such regulations, including banning or limiting certain products, may have a material adverse effect on the operations, revenues, and profitability of Biopharma Companies. The laws and regulations applicable to the process of administrative approval of medicine and its production in China require entities producing biopharma products to comply strictly with certain standards and specifications promulgated by the government. Changes in currency exchange rates and the relative value of non-U.S. currencies will affect the value of the investment. Currency exchange rates can be very volatile and can change quickly and unpredictably. Investments in non-U.S. securities involve certain risks that may not be present with investments in U.S. securities. For example, investments in non-U.S. securities may be subject to risk of loss due to foreign currency fluctuations or to political or economic instability. Investments in non-U.S. securities also may be subject to withholding or other taxes and may be subject to additional trading, settlement, custodial, and operational risks. These and other factors can make investments in the Fund more volatile and potentially less liquid than other types of investments. To the extent the Fund invests a significant portion of its assets in the securities of companies of a single country or region, such as China, it is more likely to be impacted by events or conditions affecting that country or region. The Fund is a recently organized, non-diversified management investment company with no operating history. As a result, prospective investors have no track record or history on which to base their investment decision. The Fund is considered to be non-diversified, which means that it may invest more of its assets in the securities of a single issuer or a smaller number of issuers than if it were a diversified fund. The Fund is not actively managed and the Fund's sub-adviser would not sell shares of an equity security due to current or projected underperformance of a security, industry or sector, unless that security is removed from the Index or the selling of shares of that security is otherwise required upon a reconstitution of the Index in accordance with the Index methodology. To the extent the Fund invests more heavily in particular sectors of the economy, its performance will be especially sensitive to developments that significantly affect those sectors."

Diversification may not protect against market risk.

Exchange Traded Concepts, LLC serves as the investment advisor, and Vident Investment Advisory, LLC serves as a sub advisor to the fund. The Funds are distributed by Quasar Distributors, LLC, which is not affiliated with Exchange Traded Concepts, LLC or any of its affiliates.