Exelixis (EXEL) came under a lot of pressure recently and the stock is now trading near its 52 week low following two unrelated events that took place last month. In late June, the company announced the resignation of its CEO, George Scangos, who was appointed as Biogen Idec’s (BIIB) CEO. Earlier that month, the company announced BMS (BMY) decided to give back rights for Exelixis’ flagship product, XL184. Adding to the pressure are interesting but not stellar clinical results for some of the company’s compounds at ASCO and potentially an additional partnership termination. Read the rest of this entry »
The hottest theme at this year’s 2010 ASCO (American Society of Clinical Oncology) annual meeting was without a doubt cancer immunotherapy, an old paradigm that deals with redirecting the patient’s immune system against tumors. After decades of failures, this concept is finally proving itself useful. There are basically two approaches:1) cancer vaccines that aim at eliciting an immune response against specific targets on cancer cells and 2) immunomodulatory drugs that aim at stimulating the immune system in a more general manner (not target specific). The undisputed leader in cancer vaccines is Dendreon (DNDN), which currently has the only FDA approved cancer vaccine. Following ASCO, it looks like the leader in immunomodulation drugs is BMS (BMY).
Array’s (ARRY) recent licensing deal with Novartis (NVS) is another evidence of pharma’s appetite for new oncology compounds, especially for targeted agents. Facing a patent cliff and dwindling internal pipelines, pharmaceutical companies are willing to pay a generous price for promising early stage compounds.
This is why companies with broad platform technologies that can feed the industry with new compounds represent an attractive investment opportunity. These companies include (in alphabetical order) Arqule (ARQL), Array, Exelixis (EXEL), Immunogen (IMGN), Micromet (MITI) and Seattle Genetics (SGEN). From that list, Array has been the worst performer in 2009 due to liquidity fears as well as lack of exciting clinical data for its proprietary compounds. The two recent deals with Amgen (AMGN) and Novartis helped Array strengthen its balance sheet, but more importantly, they prove that the company’s discovery and early stage development capabilities have been underestimated by the market. Read the rest of this entry »
Earlier this week, Immunogen (IMGN) got closer than ever to having a commercial product in the market. During its quarterly call, Roche removed the regulatory overhang on T-DM1’s near term fate after it disclosed plans to file for T-DM1’s approval already this year. The submission will be based on results from a recently announced phase II trial where T-DM1 demonstrated overwhelming activity in late stage breast cancer patients. Until now, it was unclear whether the FDA would be willing to consider approval based on a single arm phase II trial. Roche’s decision implies the FDA gave its unofficial and non-binding blessing for the accelerated approval.
No matter how diversified or well managed a biotech company is, eventually there is no escape from binary events. These events usually come in the form of data readout from clinical trials that can make or break the stock. Two weeks ago, Arqule (ARQL) announced topline results from a much anticipated phase II trial of its lead agent, ARQ 197, in lung cancer. The trial is evaluating ARQ 197 in combination with the approved drug, Tarceva, in patients with non-small cell lung cancer (NSCLC) who have been previously treated with chemotherapy. Although the data set is not a clear slam dunk, it generated an impressive efficacy signal that warrants advancing ARQ 197 into phase III. This, coupled with the progress the company has made on other fronts in the past year makes Arqule one of most attractive biotech stocks in the market.
At ASH 2009, Immunogen (IMGN) and its partners will present clinical data on three compounds: Sanofi-Aventis’ (SNY) SAR3419, Immunogen’s IMGN901 and Biotest’s BT-062.
The month of December has always been a busy period for biotech investors, due to two important events: The annual meeting of American Society of Hematology (ASH) and the San Antonio Breast Cancer Symposium (SABCS). Every year, these events produce clinical data that can sharply move biotech stocks in both directions. This year, Immunogen (IMGN) is about to get center stage attention at both events.
At ASH, the company and its partners will present phase I data for three different agents powered by Immunogen’s antibody-drug conjugate (ADC) technology.The most important of which is Sanofi-Aventis’ (SNY) SAR3419 in Non-Hodgkin lymphoma, a common form of blood cancer. Later that month at SABCS, Roche/Genentech is expected to present results for T-DM1, a high profile ADC for the treatment of breast cancer.
On top its JAK programs, Incyte has been developing two additional programs it intends to out-license. The first program is INCB13739 for diabetes, which already reached clinical proof of concept and could be licensed imminently. The second program, INCB7839 for breast cancer, is less advanced but could become very interesting later this year depending on data from an ongoing trial.
Last week, Incyte (INCY) sold over $130M worth of stock and $400M worth of convertible debt in an effort to solve its balance sheet issues. Thanks to the stronger cash position, the company can finally be evaluated based on its promising pipeline rather than its capital structure. More importantly, it will be able to complete a series of business development deals and focus on becoming a commercial stage company.
Earlier this month, Micromet (MITI) concluded an impressive public offering of $75M, approximately 20% of the company’s market cap. The offering illustrates the transformation the company has undergone from an anonymous biotech play into a recognized industry leader. This is also echoed by the growing attention from Wall St. When I first wrote about Micromet in 2007, the company was covered by a single analyst, RBC’s Jason Kantor, who was one of the first to see the potential in Micromet’s platform. Today the stock is covered by six additional research analysts.
