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Kite Hit By Patient Death: Kite Pharma’s 1Q17 results were totally overshadowed by the company's revelation about a cerebral edema-related death in a safety expansion cohort evaluating its lead pipeline candidate, CAR-T therapy, KTE-C19 (axicabtagene ciloleucel). Although Kite said that patient recruitment in ongoing studies was not paused or put on hold, investors got spooked by the update sending the shares down 13.2% (Read more: Here's Why Kite Pharma Stock Is Plummeting Today). While the news has left investors jittery, the general view is that the news will not dent the candidate’s chances of gaining FDA approval later this year.
Regeneron in Immuno-Oncology (I-O) Clinical Study Deals: Regeneron is tying up with Inovio for a clinical study deal that will see the companies evaluating Regeneron’s PD-1 inhibitor, REGN2810 in combination with Inovio's INO-5401 T cell activating immunotherapy encoding multiple antigens and INO-9012, an immune activator encoding IL-12 for newly-diagnosed glioblastoma multiforme (GBM).
A phase Ib/IIa immuno-oncology study is slated to commence later this year with safety and tolerability being the primary endpoints. Immunological impact, progression-free survival and overall survival will also be evaluated.
GBM is the most common and aggressive type of brain cancer with an extremely poor prognosis even though a limited number of new therapies was approved over the last ten years. While the median overall survival for patients on standard of care therapy is about 15 months, the average five-year survival rate is less than 3%.
Regeneron has also signed up with South Korean biotech company SillaJen for a phase Ib dose-escalation study in renal cell carcinoma (RCC) or kidney cancer. This agreement will see REGN2810 being evaluated in combination with SillaJen's oncolytic vaccinia virus, Pexa-Vec, in patients with previously treated metastatic or unresectable kidney cancer. The study will commence later this year.
Amgen Ties Up with Feldan and Elasmogen for Intracellular Biologics: Biotech major Amgen is teaming up with Elasmogen Ltd and Feldan Therapeutics for the development and delivery of novel intracellular biologics. Feldan’s Shuttle platform and Elasmogen’s soloMER technology will be used under the deal for two undisclosed intracellular targets.
Promising Mid-Stage Data on AbbVie Crohn’s Drug: AbbVie (ABBV - Free Report) presented promising results from a mid-stage study on its investigational oral JAK1-selective inhibitor, upadacitinib (ABT-494), for the treatment of adult patients with moderately to severely active Crohn's disease. The company said that the results support the advancement of the candidate into late-stage studies for the indication -- a phase III program is scheduled to commence later this year. Upadacitinib is one of the key candidates in the company’s immunology pipeline and is in a mid-stage study for atopic dermatitis while another study for ulcerative colitis is scheduled to start shortly. Meanwhile, data from the first of six late-stage studies for rheumatoid arthritis should be out in the coming months.
Array Reports Positive Melanoma Data, Signs Deal with Merck: Array (ARRY - Free Report) announced positive top-line results from Part 2 of a late-stage study evaluating binimetinib, a MEK inhibitor, and encorafenib, a BRAF inhibitor, in patients with BRAF-mutant advanced, unresectable or metastatic melanoma. The median progression-free survival (PFS) for patients on binimetinib plus encorafenib was 12.9 months compared to 9.2 months for patients on encorafenib. Array plans to file for FDA approval in June or July this year. According to information provided by Array, currently marketed MEK/BRAF combination agents have a run rate approaching $1 billion in annual worldwide sales.
Array also entered into a clinical trial collaboration agreement with Merck under which a combination of binimetinib and Merck’s Keytruda (anti-PD-1 therapy) will be evaluated in colorectal cancer patients with microsatellite stable tumors. The study is scheduled to commence in the second half of the year.
Novartis Opts in for Conatus Drug: Conatus’ partner Novartis has decided to exercise its option to an exclusive license for the global development and commercialization of emricasan, a first-in-class, orally-active pan-caspase inhibitor being developed for chronic liver disease including nonalcoholic steatohepatitis (NASH) cirrhosis. Emricasan is in a phase IIb study in patients with decompensated liver cirrhosis caused by NASH.
Conatus stands to receive a $7 million option exercise payment in mid-2017. So far, the company has received a $50 million upfront payment plus $15 million in exchange for a convertible promissory note issued to Novartis under the Dec 2016 agreement.
NASH is an increasingly common, progressive form of fatty-liver disease which is becoming a significant and growing health issue given the rising obesity epidemic. With no treatments currently approved for this disease, the market opportunity is significant. Several companies are working on developing treatments for NASH -- the market could be worth billions of dollars and many companies are hoping to cash in on this opportunity.
Data readouts from the emricasan phase IIb clinical development program are expected in the first half of 2018.
Performance
Medical - Biomedical and Genetics Industry 5YR % Return
The NASDAQ Biotechnology Index declined 1.8% over the last five trading sessions. Among major biotech stocks, Alexion declined 6.5% while Regeneron gained 6.3% with the Dupixent launch looking strong. Over the last six months, Vertex was up 25.6% while Biogen was down 18.3% (See the last biotech stock roundup here: Amgen, Gilead, Celgene Q1 Earnings, Sunesis Down on Vosaroxin Update).
What's Next in the Biotech World?
Watch out for earnings results from several small biotech companies in the coming days.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors.
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Biotech Stock Roundup: Regeneron, BioMarin Report Q1, Kite Down on Patient Death
Kite Pharma’s announcement regarding a patient death related to its lead pipeline candidate was the big news in the biotech sector with the company’s shares taking a hit. Meanwhile, major players like Regeneron (REGN - Free Report) and BioMarin (BMRN - Free Report) reported 1Q results -- while Regeneron posted a mixed quarter (Read more: Regeneron Q1 Earnings Miss, Revenues Beat Estimates), BioMarin surpassed expectations (Read more: BioMarin Posts Earnings in Q1, Sales Top, Stock Up).
Recap of the Week’s Most Important Stories
Kite Hit By Patient Death: Kite Pharma’s 1Q17 results were totally overshadowed by the company's revelation about a cerebral edema-related death in a safety expansion cohort evaluating its lead pipeline candidate, CAR-T therapy, KTE-C19 (axicabtagene ciloleucel). Although Kite said that patient recruitment in ongoing studies was not paused or put on hold, investors got spooked by the update sending the shares down 13.2% (Read more: Here's Why Kite Pharma Stock Is Plummeting Today). While the news has left investors jittery, the general view is that the news will not dent the candidate’s chances of gaining FDA approval later this year.
Regeneron in Immuno-Oncology (I-O) Clinical Study Deals: Regeneron is tying up with Inovio for a clinical study deal that will see the companies evaluating Regeneron’s PD-1 inhibitor, REGN2810 in combination with Inovio's INO-5401 T cell activating immunotherapy encoding multiple antigens and INO-9012, an immune activator encoding IL-12 for newly-diagnosed glioblastoma multiforme (GBM).
A phase Ib/IIa immuno-oncology study is slated to commence later this year with safety and tolerability being the primary endpoints. Immunological impact, progression-free survival and overall survival will also be evaluated.
GBM is the most common and aggressive type of brain cancer with an extremely poor prognosis even though a limited number of new therapies was approved over the last ten years. While the median overall survival for patients on standard of care therapy is about 15 months, the average five-year survival rate is less than 3%.
Regeneron has also signed up with South Korean biotech company SillaJen for a phase Ib dose-escalation study in renal cell carcinoma (RCC) or kidney cancer. This agreement will see REGN2810 being evaluated in combination with SillaJen's oncolytic vaccinia virus, Pexa-Vec, in patients with previously treated metastatic or unresectable kidney cancer. The study will commence later this year.
Regeneron is a Zacks Rank #2 (Buy) stock -- you can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Year-to-date, the company has performed better than the Zacks-categorized Medical-Biomedical/Genetics industry with shares gaining 16.3% compared to the industry gain of 7.5%.
Amgen Ties Up with Feldan and Elasmogen for Intracellular Biologics: Biotech major Amgen is teaming up with Elasmogen Ltd and Feldan Therapeutics for the development and delivery of novel intracellular biologics. Feldan’s Shuttle platform and Elasmogen’s soloMER technology will be used under the deal for two undisclosed intracellular targets.
Promising Mid-Stage Data on AbbVie Crohn’s Drug: AbbVie (ABBV - Free Report) presented promising results from a mid-stage study on its investigational oral JAK1-selective inhibitor, upadacitinib (ABT-494), for the treatment of adult patients with moderately to severely active Crohn's disease. The company said that the results support the advancement of the candidate into late-stage studies for the indication -- a phase III program is scheduled to commence later this year. Upadacitinib is one of the key candidates in the company’s immunology pipeline and is in a mid-stage study for atopic dermatitis while another study for ulcerative colitis is scheduled to start shortly. Meanwhile, data from the first of six late-stage studies for rheumatoid arthritis should be out in the coming months.
Array Reports Positive Melanoma Data, Signs Deal with Merck: Array (ARRY - Free Report) announced positive top-line results from Part 2 of a late-stage study evaluating binimetinib, a MEK inhibitor, and encorafenib, a BRAF inhibitor, in patients with BRAF-mutant advanced, unresectable or metastatic melanoma. The median progression-free survival (PFS) for patients on binimetinib plus encorafenib was 12.9 months compared to 9.2 months for patients on encorafenib. Array plans to file for FDA approval in June or July this year. According to information provided by Array, currently marketed MEK/BRAF combination agents have a run rate approaching $1 billion in annual worldwide sales.
Array also entered into a clinical trial collaboration agreement with Merck under which a combination of binimetinib and Merck’s Keytruda (anti-PD-1 therapy) will be evaluated in colorectal cancer patients with microsatellite stable tumors. The study is scheduled to commence in the second half of the year.
Novartis Opts in for Conatus Drug: Conatus’ partner Novartis has decided to exercise its option to an exclusive license for the global development and commercialization of emricasan, a first-in-class, orally-active pan-caspase inhibitor being developed for chronic liver disease including nonalcoholic steatohepatitis (NASH) cirrhosis. Emricasan is in a phase IIb study in patients with decompensated liver cirrhosis caused by NASH.
Conatus stands to receive a $7 million option exercise payment in mid-2017. So far, the company has received a $50 million upfront payment plus $15 million in exchange for a convertible promissory note issued to Novartis under the Dec 2016 agreement.
NASH is an increasingly common, progressive form of fatty-liver disease which is becoming a significant and growing health issue given the rising obesity epidemic. With no treatments currently approved for this disease, the market opportunity is significant. Several companies are working on developing treatments for NASH -- the market could be worth billions of dollars and many companies are hoping to cash in on this opportunity.
Data readouts from the emricasan phase IIb clinical development program are expected in the first half of 2018.
Performance
Medical - Biomedical and Genetics Industry 5YR % Return
Medical - Biomedical and Genetics Industry 5YR % Return
The NASDAQ Biotechnology Index declined 1.8% over the last five trading sessions. Among major biotech stocks, Alexion declined 6.5% while Regeneron gained 6.3% with the Dupixent launch looking strong. Over the last six months, Vertex was up 25.6% while Biogen was down 18.3% (See the last biotech stock roundup here: Amgen, Gilead, Celgene Q1 Earnings, Sunesis Down on Vosaroxin Update).
What's Next in the Biotech World?
Watch out for earnings results from several small biotech companies in the coming days.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors.
Click here for Zacks' secret trade>>