BioShares Biotechnology Clinical Trials (BBC): $21.44, +$0.26, +16.5% YTD 

BioShares Biotechnology Products (BBP): $38.12, +$0.62, +16.4% YTD

 

 

MARKET COMMENTARY

 

U.S. stock index futures dipped slightly, as investors looked for fresh catalysts to keep up Wall Street’s record-setting run that started last week. Housing starts, jobless claims and Philly Fed Business Index occupy the day’s economic calendar. The dollar slipped against a basket of currencies and gold rose. European shares fell after seven straight sessions of gains, while Asian stocks closed on a mixed note. Oil steadied supported by OPEC supply cuts.

 

 

MARKET HIGHLIGHTS

 

Catalyst Biosciences announced that Andrew Hetherington has been promoted to Senior Vice President of Technical Operations. Mr. Hetherington joined Catalyst in September 2015 and has successfully led the Pfizer-to-Catalyst technology transfer of the Company’s next-generation Factor VIIa clinical candidate, and has been instrumental in advancing the Company’s next generation Factor IX clinical manufacture and associated program activities.

 

CTD Holdings presented updated compassionate use data regarding the Company’s proprietary formulation of hydroxypropyl beta cyclodextrin, Trappsol® Cyclo™, for the treatment of Niemann-Pick Disease Type C (NPC). The data were presented in a poster entitled, "Intravenous Cyclodextrin Trials and Compassionate Use in Niemann-Pick Type C Disease", at the 13th Annual WORLDSymposium, the premier scientific conference focused on lysosomal storage diseases.

 

TRACON Pharmaceuticals announced that it has initiated patient dosing in its Phase 3 TAPPAS (TRC105 And Pazopanib versus Pazopanib alone in patients with advanced AngioSarcoma) trial of TRC105.

 

Windtree Therapeutics announced that data from a preclinical influenza study showed that aerosolized KL4 surfactant reduced lung inflammation and improved overall survival in a well-established preclinical animal model. The Company believes that these preclinical data add to a growing body of evidence that supports the role of KL4 surfactant as a potential medical intervention to reduce morbidity and mortality associated with both seasonal and pandemic influenza pneumonia.  Separately, Windtree announced that it has completed a $10.5 million private placement of convertible preferred stock units and now expects that it has sufficient capital to fund its operations through the AEROSURF® phase 2b clinical trial data release in mid-2017.

 

BrainStorm Cell Therapeutics announced that it plans to contract with City of Hope’s Center for Biomedicine and Genetics to produce clinical supplies of NurOwn® adult stem cells for the company’s planned randomized, double-blind, multi-dose Phase 3 clinical study in patients with Amyotrophic Lateral Sclerosis (ALS).  City of Hope is expected to support all U.S. medical centers that will be participating in the Phase 3 trial.

 

BioTime announced the closing of its previously announced underwritten public offering. BioTime, Inc. sold 7,453,704, shares of its common stock in the offering, which includes 972,222 shares of its common stock issued in connection with the exercise in full of the underwriters’ over allotment option. The offering price to the public was $2.70 per share and gross proceeds to BioTime, Inc. are approximately $20.1 million, before deducting underwriting discounts and commissions and other estimated offering expenses payable by BioTime, Inc.  Raymond James & Associates, Inc. acted as the sole book-running manager for the offering. Ladenburg Thalmann & Co. Inc., Chardan and LifeSci Capital LLC acted as co-managers for the offering.

 

Achaogen will host a Research & Development Day to highlight advances in the Company’s pipeline, in New York City on March 1, 2017 from 12:00pm to 2:30pm ET.  The meeting will feature presentations by key opinion leaders Yoav Golan, MD, MS, FIDSA (Tufts Medical Center) and Thomas M. Hooton, MD (University of Miami School of Medicine), who will discuss the current treatment landscape for MDR gram-negative infections and novel treatments under development. Both experts will be available to answer questions.

 

Shire reported 4Q16 non-GAAP EPS of $3.37, which compares to $2.97 for the same period a year ago. The company beat the non-GAAP EPS mean estimate of $1.09. Total revenue for 4Q16 was $3.81 billion, which compares to $1.72 billion for the same period a year ago. This compares to a mean estimate of $3.73 billion.

 

Agios Pharmaceuticals reported 4Q16 GAAP EPS loss of $1.34, which compares to a loss of $1.08 for the same period a year ago. The company beat the GAAP EPS mean estimate loss of $1.55. Total revenue for 4Q16 was $22.6 million, which compares to $6.2 million for the same period a year ago. This compares to a mean estimate of $10.9 million.

 

Alexion reported 4Q16 non-GAAP EPS of $1.26, which compares to $1.04 for the same period a year ago. The company beat the non-GAAP EPS mean estimate of $1.25. Total revenue for 4Q16 was $831.0 million, which compares to $700.9 million for the same period a year ago. This compares to a mean estimate of $836.6 million.

 

Pfizer announced top-line results from ORAL Strategy, a Phase IIIB/IV study of XELJANZ (tofacitinib citrate) 5mg twice daily (BID) in the treatment of moderate to severe rheumatoid arthritis (RA). ORAL Strategy is the first trial to compare a JAK inhibitor as monotherapy or in combination with methotrexate (MTX) versus adalimumab (Humira) plus MTX in MTX inadequate responders using ACR50 at Month 6 as the primary endpoint. There were three comparisons, which found: XELJANZ 5mg plus MTX met its primary endpoint in demonstrating non-inferiority versus Humira plus MTX; XELJANZ 5mg monotherapy did not meet its primary endpoint of non-inferiority versus Humira plus MTX or versus XELJANZ plus MTX.

 

Mesoblast announced 39-week data from its Phase II trial in patients with rheumatoid arthritis (RA) resistant to anti-Tumor Necrosis Factor (TNF) agents. The results showed that a single intravenous infusion of the Company’s proprietary allogeneic cell therapy product candidate, MPC-300-IV, was well tolerated and demonstrated a durable improvement in clinical symptoms, physical function, and disease activity relative to placebo over this period of follow-up.

 

Valeant Pharmaceuticals announced that the FDA has approved the BLA for SILIQ (brodalumab) injection, for subcutaneous use, a monoclonal antibody that targets the IL-17 receptor for patients with moderate-to-severe plaque psoriasis. SILIQ is indicated for the treatment of moderate-to-severe plaque psoriasis in adult patients who are candidates for systemic therapy or phototherapy and have failed to respond or have lost response to other systemic therapies. Valeant expects to commence sales and marketing of SILIQ in the U.S. in the second half of 2017.

 

StreetAccount reported that according to the FDA’s Orphan Drug product website, Millennium Pharmaceuticals has been granted Orphan drug designation for 6-{[(1R,2S)-2-aminocyclohexyl]amino}-7-fluoro-4-(1-methyl-1H-pyrazol-4-yl)-1,2-dihydro-3H-pyrrolo[3,4-c]pyridine-3-one monocitrate for the treatment of diffuse large B-cell lymphoma.

 

Takeda Pharmaceutical Company Limited announced the completion of its acquisition of ARIAD Pharmaceuticals for $24.00 per share in cash.

 

Eli Lilly and Incyte announced additional detailed results from RA-BEAM – a pivotal Phase III study of baricitinib in the treatment of moderate-to-severe rheumatoid arthritis (RA) – were published in the New England Journal of Medicine. The New England Journal of Medicine publication includes supplementary data, which show that starting as early as week 8, and sustained through week 52, a higher proportion of patients taking baricitinib achieved ACR50 and ACR70 response – composite scores that represent at least 50 percent and 70 percent improvement, respectively, in multiple components of RA disease activity – compared to adalimumab (Humira). These improvements were statistically significant compared to adalimumab at weeks 12, 20, 28, 32 and 40. At week 52, both ACR50 and ACR70 rates were higher in the baricitinib group compared to adalimumab, although only ACR 50 was statistically significant.

 

Theratechnologies announced that pharmacokinetics (PK) and pharmacodynamics (PD) data comparing the intramuscular (IM) with the intravenous (IV) administration of ibalizumab were presented at the annual Conference on Retroviruses and Opportunistic Infections (CROI) 2017.  The PK and PD of two doses of ibalizumab, 800 mg bi-weekly and 2000 mg every 4 weeks, administered IM were evaluated under study TMB-121. This data was compared to the PK and PD data of similar doses of ibalizumab administered IV from a previous study. The results showed that the PK and PD profiles of both doses of ibalizumab administered IM were comparable with IV profiles. Ibalizumab was well tolerated when administered IM or IV.

 

Cytori Therapeutics announced it has completed its acquisition of assets of privately held Azaya Therapeutics. The Acquisition provides Cytori with a proprietary liposomal nanoparticle technology platform that is intended to complement Cytori’s leadership position in regenerative medicine and expand its pipeline with two promising nanoparticle oncology drugs.

 

Lipocine announced the promotion of Gregory Bass to the newly created position of Executive Vice President and Chief Commercial Officer reporting to Dr. Mahesh Patel, President and Chief Executive Officer. Mr. Bass will be responsible for leading the commercialization of Lipocine’s product candidates, including its testosterone replacement franchise. He joined Lipocine in 2016 and has served as its Vice President of Market Access since that time.

 

Celyad announced a further step in the CAR-T NKR-2 THINK trial with the registration of a first refractory Multiple Myeloma patient. This patient is expected to receive the first dose-level (3×10(8 )CAR-T NKR-2 cells) in the coming weeks, opening the first cohort of the hematological arm of the study.

 

Acura Pharmaceuticals announced that shares of its common stock will begin to trade on the OTCQB Market, which is operated by OTC Markets Group, under the symbol "ACUR" on February 23, 2017.

 

Swedish Orphan Biovitrum announced that it has elected to add a novel product candidate (rFIXFc-XTEN) for the potential treatment of haemophilia B to the company’s collaboration agreement with Bioverativ. Sobi has the right to include the rFIXFc-XTEN fusion molecule into its collaboration agreement with Bioverativ. By making a one-time payment to Bioverativ, Sobi gains an opt-in right to participate in the final development and commercialization of this product candidate. The opt-zin right may be exercised by Sobi in connection with the submission of the marketing authorization application for rFIXFc-XTEN with the EMA. In September 2014, Sobi elected to add the rFVIIIFc-VWF-XTEN fusion molecule for the potential treatment of haemophilia A to its collaboration agreement with Bioverativ.

 

Imprimis Pharmaceuticals announced that it has begun shipping its core sterile ophthalmic medications to select customers from its FDA-registered outsourcing facility without the need for a patient-specific prescription. Over the next few weeks Imprimis’ flagship Dropless Therapy injectable and LessDrops topical formulations will become available to all customers.

 

Boehringer Ingelheim Pharmaceuticals announced that the FDA approved SPIRIVA RESPIMAT for the long-term, once-daily maintenance treatment of asthma in people age 6 and older. SPIRIVA RESPIMAT is not a treatment for sudden asthma symptoms.

 

Genomic Health announced the presentation of results from four studies evaluating the clinical value and utility of its Oncotype DX Genomic Prostate Score (GPS) in the management of early-stage prostate cancer. Collectively, these new data highlight the test’s ability to predict disease aggressiveness and refine risk stratification across National Comprehensive Cancer Network (NCCN) clinical risk groups.

 

Mylan N.V. and Biocon announced that the FDA has accepted Mylan’s BLA for MYL-1401H, a proposed biosimilar to Neulasta (pegfilgrastim), for filing through the 351(k) pathway.

 

Regulus Therapeutics announced that Nature Communications has published an article entitled "microRNA-17 family promotes polycystic kidney disease progression through the modulation of mitochondrial metabolism." The article highlights research that identifies miR-17 as a target for the treatment of autosomal dominant polycystic kidney disease (ADPKD).

 

Zymeworks announced that its lead product candidate, ZW25, has been granted orphan drug designation from the FDA in the treatment of gastric cancer, including cancer of the gastroesophageal junction (“GEJ”).

 

MOLOGEN AG announced that its partner, the Danish Aarhus University Hospital, presented new data on the TEACH study at the annual Conference on Retroviruses and Opportunistic Infections (CROI) in Seattle, USA. In this study MOLOGEN’s TLR9 agonist, the Immune Surveillance Reactivator (ISR) lefitolimod, is tested in HIV-positive patients. For the first time it was shown that lefitolimod can induce a local antiviral immune response in sigmoid colon biopsies of HIV-infected patients undergoing antiretroviral treatment (ART). Lefitolimod triggered a potent response of type I interferon – a group of proteins that help regulate the activity of the immune system and is also crucial for anti-tumor responses – in the intestine, known as one major site of HIV persistence. Notably, lefitolimod did not induce unwanted inflammation. Furthermore, higher baseline TLR9 expression was associated with fewer integrated HIV-1 DNA copies. These findings strongly support the continued development of lefitolimod as an immune surveillance reactivator and represent the potential to eradicate the latent HIV reservoir. In addition, the data suggest that a similar tumor microenvironment development can be expected in the IMPALA study, a pivotal study of lefitolimod in metastatic colorectal cancer.

 

Symbiotix Biotherapies announced that the USPTO has granted U.S. Patent 9,539,281, “Lipid-containing PSA compositions, methods of isolation and methods of use thereof,” covering the Company’s lead clinical candidate. The company, located in Boston, is developing a novel class of molecular therapeutics referred to as ZPS therapeutics, based on zwitterionic polysaccharides.

 

Lonza Houston and Selecta Biosciences have entered into a strategic manufacturing agreement. Under the terms of the agreement, Lonza will produce an Anc80-AAV-based gene therapy product for Selecta’s proprietary program for the treatment of Methylmalonic Acidemia (MMA), a rare inborn error of metabolism, and may in the future produce other Anc80-based products for which Selecta holds exclusive options.

 

Ionis Pharmaceuticals and Akcea Therapeutics, a wholly-owned subsidiary of Ionis Pharmaceuticals, announced they have closed on their exclusive, worldwide option and collaboration agreement with Novartis to develop and commercialize AKCEA-APO(a)-LRx and AKCEA-APOCIII-LRx following clearance under the Hart-Scott-Rodino Antitrust Improvements Act.  Following this approval and closing of the transaction, Novartis will pay Ionis and Akcea a $75 million up-front payment and make a $100 million equity investment in Ionis, which equates to 1,631,435 shares at $61.30 per share.  Novartis has an obligation to make a further equity investment of $50 million in the next 18 months in either Ionis at the same premium as the initial investment or in Akcea.  Ionis and Akcea are also eligible to receive a license fee as well as development, regulatory and commercial milestone payments for each drug as it advances.  In addition, Ionis and Akcea are eligible to receive tiered royalties in the mid-teens to low twenty percent range on net sales of each drug.

 

Neuralstem announced completion of subject enrollment in its Phase II clinical trial of NSI-189 for the treatment of major depressive disorder (MDD).  NSI-189 is a new chemical entity and the lead compound in Neuralstem’s neurogenic small molecule program.  Enrollment was completed ahead of schedule and data are expected in 3Q 2017.

 

Assembly Biosciences announced successful completion of the dose ranging portion of its Phase Ia/Ib trial of ABI-H0731, the company’s lead Core protein Allosteric Modulator (CpAM) in development for the treatment of chronic HBV infection.

 

Clearside Biomedical announced the enrollment of the first patient in a Phase III clinical trial (“SAPPHIRE”) of Zuprata, its proprietary suspension formulation of the corticosteroid triamcinolone acetonide, used together with EYLEA (aflibercept) for the treatment of macular edema associated with retinal vein occlusion (“RVO”).

 

Evoke Pharmaannounced that it has priced an underwritten public offering of 2,413,793 shares of its common stock at a price to the public of $2.90 per share. Gross proceeds, before underwriting discounts and commissions and estimated offering costs, are expected to be approximately $7.0 million. Evoke intends to use the net proceeds from the offering to fund clinical development, pre-approval and pre-commercialization activities for Gimoti, including the planned comparative exposure trial and planned NDA submission, and for working capital and general corporate purposes. Evoke has granted the underwriter a 45-day option to purchase up to 362,068 additional shares of its common stock. The offering is expected to close on or about February 22, 2017, subject to satisfaction of customary closing conditions. Laidlaw & Company (UK) Ltd. is acting as sole book-running manager for the offering.

 

 

ANALYST RECOMMENDATIONS

 

Ladenburg Thalman analyst Matthew Kaplan initiated coverage of Albireo Pharma with a “buy” rating and $40 price target, citing the company’s lead program, A4250, is currently completing Phase II development and is on track to launch Phase III development in 1H 2017 for the treatment of an orphan pediatric disease.

 

Following Neurocrine’s earnings, HC Wainwright analyst Andrew Fein increased his price target to $100 from $80.

 

Ladenburg Thalman analyst Christopher James initiated coverage of BioCryst Pharmaceuticals with a “buy” rating and $11 price target, citing BioCryst, which uses a structure based design approach in discovering small molecules, is poised to become a leading oral drug rare disease company.

 

FBR analyst Ed white downgraded Tesaro to “market perform” from “outperform” and increased his price target to $202 from $151, citing the risk/reward profile is neutral following the recent run up in the stock price, due to takeout speculation in the financial press, such as Reuters and Barron’s.

 

Goldman analyst Terence Flynn downgraded Regeneron to “neutral” from “buy,” citing potential nearer-term competitive and policy headwinds for the stock.

 

Ladenburg Thalman analyst Kevin DeGeeter increased his price target of Mesoblast to $7.35 from $6.50, citing a single infusion of MPC-300-IV appeared to result in durable responses out to at least 39 weeks and MESO identified the highest dose (2 million MPC/kg dose) as the more effective regimen.

 

Leerink analyst Jason Gerberry increased his price target of Ardelyx to $24 from $22, citing Tenapanor achieves important clinical de-risking following the first Phase III.

 

UBS analyst Jeffrey Hung increased his price target of Esperion Therapeutics to $23 from $11, citing increased confidence in earlier potential launch.