BioShares Biotechnology Clinical Trials (BBC): $19.20, -$0.64, -33.9% YTD

BioShares Biotechnology Products (BBP): $33.06, -$0.97, +7.3% YTD

 

 

MARKET COMMENTARY

 

U.S. stock index futures pointed to a lower open for Wall Street ahead of U.S. payrolls data, which may strengthen the case for the Federal Reserve to raise interest rates. European shares fell as investors stayed cautious before a referendum in Italy that could trigger fresh political uncertainty in the region. Asian shares backtracked on profit booking. The dollar fell against a basket of currencies, while gold edged higher. Oil prices eased from the 16-month high.

 

 

MARKET HIGHLIGHTS

 

Ignyta announced data examining the combination of entrectinib and trametinib in overcoming resistance to TRK inhibition during a late-breaking oral plenary presentation (during the Exceptional Response and Expected Resistance Session) at the 2016 EORTC-NCI-AACR (ENA) Molecular Targets and Cancer Therapeutics Symposium in Munich, Germany. Entrectinib is the company’s orally available, CNS-penetrant tyrosine kinase inhibitor, targeting tumors that harbor TRK, ROS1 or ALK fusions, and is currently in a registration-enabling Phase 2 clinical trial known as STARTRK-2.

 

Basilea Pharmaceutica announced the expansion of its ongoing oncology drug  candidate BAL101553 clinical phase I/IIa oral formulation study. The first patient has been dosed in an additional arm containing adult patients with recurrent or progressive glioblastoma (brain cancer) after prior radiotherapy with or without chemotherapy.

 

CTI BioPharma announced the results of a translational pharmacology study comparing biomarker activity profiles for three JAK inhibitors: pacritinib, ruxolitinib and momelotinib, using the BioMAP(R) Diversity PLUS panel of in vitro human primary cell-based systems. The results demonstrated distinct profiles amongst these JAK inhibitors and suggest that clinical responses are likely to be distinct with each agent. The results were presented at the EORTC-NCI-AACR Molecular Targets and Cancer Therapeutics Symposium, November 29 – December 2 in Munich, Germany.

 

Amgen and Allergan announced the submission of a MAA to the EMA for ABP 215, a biosimilar candidate to Avastin (bevacizumab). The companies believe this submission is the first bevacizumab biosimilar application submitted to the EMA.

 

Novo Nordisk announced new Phase IIIb trial (DUAL VII) results with Xultophy (IDegLira). Xultophy is a once-daily, single injection fixed combination of a long-acting basal insulin (insulin degludec) and a glucagon-like peptide-1 (GLP-1) receptor agonist (liraglutide). The open-label trial investigated the efficacy and safety of Xultophy compared with insulin glargine U100 in combination with insulin aspart at all main meals, after 26 weeks of treatment in 506 adults with type 2 diabetes. The trial successfully achieved its objective by demonstrating that treatment with Xultophy is non-inferior to insulin glargine U100 in combination with insulin aspart with regards to lowering of HbA1c. From a mean baseline HbA1c of 8.2%, both patient groups reached a similar HbA1c level of 6.7% after 26 weeks of treatment. At the end of the trial, people treated with Xultophy required 40.1 units compared to a total of 84.6 units of insulin for people treated with insulin glargine U100 in combination with insulin aspart.

 

On November 29, 2016, Arrowhead Pharmaceuticals notified David Lewis, the Company’s Chief Scientific Officer, that his position will be terminated, effective December 13, 2016.

 

NeuroDerm announced the completion of a pilot study (trial 101) in healthy subjects comparing the pharmacokinetics (PK) of ND0701, the Company’s proprietary continuous, subcutaneously delivered apomorphine liquid formulation, and commercial apomorphine (APOGO). Study results demonstrate that ND0701 produced PK results that were comparable to those produced by the referenced drug. Based on these results, the Company plans to pursue a PK similarity regulatory development route in the EU for ND0701, will initiate a follow-up comparison PK study in the first half of 2017 and meet with European regulatory authorities in the second half of 2017 to discuss its development strategy. The Company is evaluating in parallel the development of ND0701 for the U.S. market.

 

Allergan announced that they, along with Qualicaps, have reached a settlement regarding their litigation with Zydus Pharmaceuticals (USA) and Cadila Healthcare Limited relating to United States Patent No. 6,649,180 and Allergan’s DELZICOL (mesalamine) product. The ‘180 patent is listed in the Orange Book in connection with DELZICOL and will expire on April 13, 2020.

 

Allergan provided additional information on its previously announced Accelerated Share Repurchase (ASR) Program. As previously announced, the Company entered into a variable tenor ASR arrangement on November 2, 2016, under which the Company will repurchase $10 billion of its ordinary shares. Approximately 40.5 million shares worth $8 billion were received and retired by Allergan during November 2016, based upon Allergan’s stock price at certain reference points during the month. The remaining shares, if any, under the ASR will be received and retired by the third quarter of 2017, although they could be received earlier if the ASR execution is completed sooner. Fifty percent of the ASR Program will be collared. The cap and floor on the collar will be based upon the Allergan stock price over a reference period.

 

Catalent announced that its wholly owned subsidiary, Catalent Pharma Solutions, priced a private offering of EUR380.0 million aggregate principal amount ($404.5 million U.S. dollar equivalent) of 4.75% senior unsecured notes due 2024 at par.

 

bluebird bio announced two new appointments as part of the company’s ongoing preparation for commercial readiness. Susanna High was named chief operating officer and Andrew Obenshain was named senior vice president and head of Europe.

 

MyoKardia announced that the Company has received a $25 million milestone payment in accordance with the research agreement between MyoKardia and Sanofi established in August 2014 for the filing of an IND application with the FDA for MYK-491 in dilated cardiomyopathy (DCM).

 

Sunovion Pharmaceuticals announced the initiation of its global Phase II program for SEP-363856, a novel, investigational psychotropic agent being studied as a treatment for patients with schizophrenia or Parkinson’s disease psychosis. The Phase II program is comprised of three studies designed to evaluate the safety, efficacy and tolerability of SEP-363856.

 

Vertex announced that effective January 1, 2017, we have appointed Ian F. Smith our EVP – Chief Operating Officer and Chief Financial Officer and Michael Parini our EVP – Chief Legal and Administrative Officer.

 

Helius Medical Technologies announced, based on favorable preliminary results, the expansion of a comprehensive study to further characterize physiological changes in improved cognitive function resulting from investigational PoNS Therapy in healthy subjects.

 

Impel NeuroPharma announced that it has closed a Series C funding round in an amount up to $36M. venBIO, 5AM Ventures and Vivo Capital, all life science focused firms, each made equal investments to be funded in two tranches. Impel NeuroPharma received $21M in the initial tranche with the remaining $15M to be received upon accomplishment of certain development and business milestones.

 

Five Prime Therapeutics announced that a poster featuring data related to FPA144 in urothelial cancer (UC), also known as bladder cancer, was presented at 28th EORTC-NCI-AACR Symposium on Molecular Targets and Cancer Therapeutics in Munich, Germany.

 

Diplomat Pharmacy announced that it will be dispensing DARZALEX (daratumumab) in combination with REVLIMID (lenalidomide) and dexamethasone or with VELCADE (bortezomib) and dexamethasone.

 

Reuters reported that Britain’s healthcare cost-effectiveness watchdog NICE has recommended use of Merck‘s immunotherapy drug Keytruda in certain lung cancer patients, after the U.S. drugmaker cut the price further for the state-run health service.

 

GlaxoSmithKline and Innoviva announced that the Japanese Ministry of Health, Labour and Welfare (MHLW) has approved Relvar Ellipta (fluticasone furoate / vilanterol 100/25 mcg) for the relief of various symptoms with chronic obstructive pulmonary disease (chronic bronchitis, pulmonary emphysema) (in the case where concurrent use of inhaled corticosteroid and long-acting inhaled beta(2) agonist is required).

 

Taro Pharmaceutical Industries announced that its Board of Directors has appointed Mr. Abhay Gandhi to the position of Interim CEO, effective January 1, 2017. As previously announced, the Interim CEO will serve in this role during the period from Mr. Kal Sundaram’s departure at the end of this year until the arrival in April 2017 of Mr. Uday Baldota, Taro’s recently appointed CEO.

 

Karolinska Development AB announced that its portfolio company Dilafor AB, a drug development company focusing on the development of tafoxiparin for obstetric indications, has been granted a U.S. patent protecting its proprietary compound tafoxiparin.

 

Intellia Therapeutics announced the move to its new laboratory facilities at 40 Erie Street, in Cambridge. In recognition of Intellia’s leadership in genome editing, Intellia CEO and Founder Nessan Bermingham, Ph.D., President and CEO of the Massachusetts Life Sciences Center Travis McCready, and President and CEO of MassBio Bob Coughlin, will inaugurate the new facility at an evening ribbon cutting ceremony.

 

Calithera Biosciences announced that preclinical data for its lead drug candidate CB-839, the company’s novel, orally bioavailable glutaminase inhibitor, will be presented at the 58th American Society of Hematology (ASH) Annual Meeting, which is being held from December 3-6, 2016 in San Diego, California.

 

CEL-SCI announced that it has agreed to sell 34,024,000 shares of common stock and warrants to purchase common stock at a price of $0.125. The warrants consist of 17,012,000 Series CC warrants to purchase 17,012,000 shares of common stock, 34,024,000 Series DD warrants to purchase 34,024,000 shares of common stock and 34,024,000 Series EE warrants to purchase 34,024,000 shares of common stock. The Series CC warrants are immediately exercisable, expire in five-years and have an exercise price of $0.20 per share. The Series DD warrants are immediately exercisable, expire in six-months and have an exercise price of $0.18 per share. The Series EE warrants are immediately exercisable, expire in nine-months and have an exercise price of $0.18 per share. The gross proceeds to CEL-SCI from this offering are expected to be approximately $4.25 million, excluding any future proceeds that may be received from the exercise of the warrants. CEL-SCI currently intends to use the net proceeds from the offering to fund the continued development of Multikine*, LEAPS and for other general corporate purposes. Rodman & Renshaw, a unit of H.C. Wainwright is acting as exclusive placement agent in connection with the offering.

 

Protalix BioTherapeutics announced the entry into a definitive exchange agreement relating to an exchange of $54.1 million principal amount of the Company’s outstanding 4.50% Senior Convertible Notes due 2018 for (i) $40.2 million principal amount of newly issued 7.50% Senior Secured Convertible Notes due 2021 and (ii) approximately 23.8 million shares of common stock, $0.001 par value per share. Concurrently, the Company announced the entry into a definitive note purchase agreement with commitments to issue and sell, in a private placement, $22.5 million principal amount of the Notes to qualified institutional buyers as defined in Rule 144A under the Securities Act of 1933, as amended. The Exchange and the Private Placement are expected to close concurrently on December 7, 2016, subject to satisfaction of customary closing conditions.

 

 

ANALYST RECOMMENDATIONS

 

LifeSci Advisors analyst Jerry Isaacson initiated coverage of CTD Holdings.

 

SunTrust analyst Edward Nash initiated coverage of Versartis with a “buy” rating and $25 price target, citing somavaratan, a long-acting growth hormone developed through a proprietary chemistry platform, XTEN, has a high probability of clinical success for the treatment of growth hormone deficiency.

 

Ladenburg Thalmann transferred coverage of Cempra to analyst Kevin DeGeeter who decreased the firm’s price target to $10.50 from $51, citing lower worldwide peak sales potential for CABP.

 

Guggenheim analyst Tony Butler initiated coverage of Pfizer with a “neutral” rating, citing Pfizer’s growth profile is modest relative to its pharmaceutical peers with respect to revenue and EPS growth.  

 

Janney analyst Ken Trbovich initiated coverage of Pacira Pharmaceuticals with a “neutral” rating and $31 fair value estimate, citing the valuation already prices in the benefit PCRX intends to seek by expanding Exparel’s indication to include nerve block following completion of Phase III trials in 1Q17.

 

Maxim analyst Jason McCarthy decreased his price target of Stellar Biotechnologies to $4 from $7, citing educed the revenue build for KLH supply, given the short term lack of partner catalysts that would drive more demand, as well as out-year estimates based on potential movement away from vaccines for AD.