BioShares Biotechnology Clinical Trials (BBC): $20.33, +$0.10, +10.4% YTD

BioShares Biotechnology Products (BBP): $36.62, +$0.29, +11.8% YTD

 

 

MARKET COMMENTARY

 

Wall Street was set to follow global markets higher as gains in oil prices boosted energy shares and upbeat results from European bellwethers cheered investor sentiment. Shares of Kellogg, News Corp, Nvidia, Expedia and Activision will be in focus as the companies are scheduled to report their results later in the day. Jobless claims and wholesale inventories data occupies the day’s economic calendar. The New Zealand dollar was the biggest faller among major currencies after its central bank said it may keep rates steady for at least two years. Meanwhile, gold prices steadied near three-month highs.

 

 

MARKET HIGHLIGHTS

 

Ignyta announced that updated results from two Phase 1 trials of entrectinib—the company’s investigational, orally available, CNS-active tyrosine kinase inhibitor targeting tumors that harbor TRK, ROS1 or ALK fusions—were published in the journal Cancer Discovery. The studies showed entrectinib to be well tolerated, with responses observed in non-small cell lung cancer (NSCLC), colorectal cancer, mammary analog secretory carcinoma (MASC), melanoma and renal cell carcinoma as early as four weeks after first treatment and lasting as long as 2.5 years and still ongoing. Entrectinib is currently being studied in a separate registration-enabling global Phase 2 basket clinical trial known as STARTRK-2.

 

Palatin Technologies announced results for its second quarter ended December 31, 2016.  Palatin reported a net loss of $(10.0) million, or $(0.06) per basic and diluted share, for the quarter ended December 31, 2016, compared to a net loss of $(13.2) million, or $(0.08) per basic and diluted share, for the same period in 2015.  Palatin’s cash, cash equivalents and investments were $13.5 million, before giving effect to the receipt of $60 million from AMAG, as of December 31, 2016, compared to cash and cash equivalents $9.4 million at June 30, 2016.  Current liabilities were $19.6 million as of December 31, 2016, compared to $13.9 million as of June 30, 2016.  Palatin believes that existing capital resources will be adequate to fund our planned operations through at least the fiscal year ending June 30, 2018.

 

Neovacs has been granted a new patent from the Chinese Patent Office (SIPO), titled: "Method of treatment of a disease related to the overexpression of IFNα." This new patent has been also filed in all major markets in the world, to cover the use of Neovacs IFNα Kinoid vaccine for all diseases characterized by an overexpression of the cytokine, Interferon alpha (IFNα), including Lupus, Dermatomyositis and Type 1 diabetes. This patent provides a strong protection until at least 2032.

 

Prothena Corporation will present and participate in the Leerink Partners 6th Annual Global Healthcare Conference on February 16th at 11:30 AM ET in New York, NY.

 

Heron Therapeutics is scheduled to conduct a fireside chat presentation at the Leerink Partners 6th Annual Global Healthcare Conference on Wednesday, February 15, 2017, at 11:30 a.m. ET.

 

Aradigm Corporation will present at the 19th Annual BIO CEO & Investor Conference 2017 on Monday, February 13, 2017, at 1:30 p.m. ET.

 

Onconova Therapeutics will present a Company overview at the 19th Annual BIO CEO & Investor Conference on Monday, February 13th @ 3pmET, and at the SeeThruEquity 3rd Annual Innovations Investor Conference on Wednesday, February 22nd @ 11amET.

 

Regeneron Pharmaceuticals and Sanofi announced that the United States Court of Appeals for the Federal Circuit has stayed (suspended) the permanent injunction for Praluent (alirocumab) Injection pending the companies’ appeal. This ruling means that Sanofi and Regeneron will continue marketing, selling and manufacturing Praluent in the U.S. during the appeal process.  Sanofi and Regeneron remain committed to ensuring patients who can benefit from Praluent continue to have access to this innovative therapy.

 

Regeneron reported 4Q16 non-GAAP EPS of $3.04, which compares to $2.23 for the same period a year ago. The company beat the non-GAAP EPS mean estimate of $3.03. Total revenue for 4Q16 was $1.23 billion, which compares to $1.10 billion for the same period a year ago. This compares to a mean estimate of $1.30 billion.

 

After yesterday’s close, Alnylam Pharmaceuticals reported 4Q16 GAAP EPS loss of $1.32, which compares to a loss of $1.07 for the same period a year ago. The company missed the GAAP EPS mean estimate loss of $1.28. Total revenue for 4Q16 was $17.5 million, which compares to $7.6 million for the same period a year ago. This compares to a mean estimate of $11.0 million. Following earnings, Needham analyst Alan Carr decreased his price target to $68 from $98; Goldman Sachs analyst Terence Flynn increased his price target to $39 from $36; Morgan Stanley analyst David Lebowitz increased his price target to $39 from $36.

 

After yesterday’s close, Fluidigm reported 4Q16 GAAP EPS loss of $0.61, which compares to a loss of $0.45 for the same period a year ago. The company met the GAAP EPS mean estimate. Total revenue for 4Q16 was $25.1 million, which compares to $30.7 million for the same period a year ago. This compares to a mean estimate of $25.9 million.

 

Acorda Therapeutics announced Phase III clinical data of CVT-301, showing a statistically significant improvement in motor function in people with Parkinson’s disease experiencing OFF periods. CVT-301 is an investigational, inhalable formulation of levodopa (L-dopa). It is being studied as a treatment for OFF periods in people with Parkinson’s disease taking an oral carbidopa / levodopa regimen. OFF periods refer to the re-emergence of Parkinson’s symptoms.

 

Viking Therapeutics announced positive initial results from a proof-of-concept study of VK2809 in an in vivo model of glycogen storage disease Ia (GSD Ia).  GSD Ia is a rare, orphan genetic disease that results in excess accumulation of glycogen and lipids in liver tissue.  Data to date showed that treatment with VK2809 produced rapid and substantial reductions in liver triglyceride content, liver weight and liver weight as a percentage of body weight compared with vehicle-treated controls.  Complete results from the ongoing study, which is being conducted under a sponsored research agreement between Duke University and Viking, will be presented at an upcoming scientific meeting.

 

Peregrine Pharmaceuticals announced the publication of positive proof-of-concept data for a novel exosome-based cancer detection platform. Results of the study, conducted at University of Texas (UT) Southwestern Medical Center, showed researchers were able to distinguish between healthy subjects and patients with ovarian tumors based on the levels of exosomes containing phosphatidylserine (PS) found in their plasma. Furthermore, analysis of the PS-positive exosome levels allowed researchers to distinguish between malignant and benign tumors. These data were recently published online by the peer-reviewed journal, Oncotarget, in a paper titled, "Detection of phosphatidylserine-positive exosomes as a diagnostic marker for ovarian malignancies: a proof-of-concept study."

 

Neuraltus Pharmaceuticals announced the confirmatory Phase II study of the Company’s lead investigational treatment NP001 for amyotrophic lateral sclerosis has enrolled 50 of the study’s 120 participants.  The study is enrolling patients at 18 sites in North America.  The Company anticipates completing enrollment of the study during the second quarter of 2017, with data analysis expected in the first quarter of 2018.

 

Forward Pharma announced that it has received a non-refundable cash fee of $1.25 billion in connection with the execution and delivery of a Settlement and License Agreement with two wholly owned subsidiaries of Biogen and certain other parties.

 

IntelGenx and Tetra Bio-Pharma announced the signing of a binding term sheet for the development and commercialization of a drug product containing dronabinol. Under the binding term sheet, Tetra will have exclusive rights to sell the product in North America with a right of first negotiation for outside the U.S. and Canada.

 

Boehringer Ingelheim announced the initiation of a Phase II trial of afatinib (Gilotrif) in combination with pembrolizumab (Keytruda) for patients with locally advanced or metastatic squamous cell carcinoma (SqCC) of the lung.

 

VM BioPharma, the United States division of ViroMed, announced that the scientific journal, Amyotrophic Lateral Sclerosis and Frontotemporal Degeneration has published clinical safety and tolerability data on the Company’s lead investigational drug, VM202, a novel, Phase I/II gene therapy for the potential treatment of Amyotrophic Lateral Sclerosis (ALS). The peer-reviewed article titled, "Open Label Study to Assess the Safety of VM202 in Subjects with Amyotrophic Lateral Sclerosis," appeared on February 6th online, and will be published in a future print issue of the journal.

 

Jazz Pharmaceuticals announced that the first patient has been enrolled in a Phase II clinical study evaluating JZP-110, a selective dopamine and norepinephrine reuptake inhibitor, as a potential treatment for excessive sleepiness (ES) in adult patients with Parkinson’s disease.  The clinical study will be conducted across approximately 15 centers in the U.S.

 

Ovid Therapeutics announced it has randomized the first patient in its STARS trial – a Phase II clinical trial of OV101 in adults with Angelman syndrome. OV101 (gaboxadol), a delta (δ)-selective GABAA receptor agonist, is believed to be the first investigational drug to target the disruption of tonic inhibition, a key mechanism that allows a healthy human brain to decipher excitatory and inhibitory neurological signals correctly without being overloaded. Tonic inhibition is believed to play a significant role in the developmental and neurological symptoms characteristic of disorders such as Angelman syndrome and Fragile X syndrome.

 

Ovid Therapeutics and NeuroPointDX announced that they have entered into a collaboration to identify novel biomarkers of Angelman syndrome by analyzing metabolomic profile data as part of Ovid’s ongoing randomized, double-blind, placebo-controlled Phase II clinical trial (STARS).

 

INC Research Holdings announced the appointment of Eric Paul Pâques, previously the Chief Executive Officer for GRÜNENTHAL GROUP, to the Company’s Board of Directors. Mr. Pâques joins the INC Research Board as an independent director and will be a Class I director serving a term ending at the Company’s 2018 Annual Meeting.

 

Apricus Biosciences announced that the Company was notified that the Nasdaq Hearings Panel (the “Panel”) has granted the Company’s request for continued listing on Nasdaq pursuant to an extension through May 30, 2017, by which date the Company must evidence full compliance with all applicable criteria for continued listing on The Nasdaq Capital Market, including the $2.5 million stockholders’ equity requirement. The Company is diligently working to timely satisfy the terms of the Panel’s decision.

 

The board of directors of Eli Lilly has elected Carolyn R. Bertozzi, Ph.D., as a new member, effective Feb. 10, 2017. As a member of Lilly’s board, she will serve on the Science and Technology and Public Policy and Compliance Committees of the board.

 

Hill-Rom Holdings announced the planned private offering, subject to market and other conditions, of $300 million in aggregate principal amount of senior unsecured notes due 2025 (the "Notes"). The Notes will be guaranteed on a senior unsecured basis by certain of Hill-Rom’s existing and future wholly‑owned domestic restricted subsidiaries.

 

MediWound announced positive results from a Phase II study that evaluated the safety, pharmacokinetics (transcutaneous absorption) and efficacy of NexoBrid in hospitalized children and adults with severe thermal burns. The multicenter, open-label, single-arm study was conducted in Europe, Israel and India and included 36 patients with severe burns of 4% to 30% total body surface area (TBSA).  NexoBrid was applied to burns of up to 15% TBSA in one session, and when the wound area to be treated was more than 15% TBSA, NexoBrid was applied in two separate sessions, each up to 15% TBSA.  Trial results showed that the use of NexoBrid was safe and effective. Furthermore, the pharmacokinetic profile following NexoBrid’s first and second topical application was comparable, suggesting no concern with accumulation following a second topical application of NexoBrid.

 

Syndax Pharmaceuticals announced that Richard P. Shea is stepping down from his position on the Syndax Board of Directors and is joining the Company as Chief Financial Officer, effective February 13, 2017. Mr. Shea has more than 30 years of experience in a range of financial and advisory roles in the biotechnology industry, most recently serving as Senior Vice President and Chief Financial Officer of Momenta Pharmaceuticals, Inc. as well as the chair of the Audit Committee of Syndax’s Board of Directors.

 

EnteroMedics announced the publication of three-year data from the Company’s VBLOC DM2 Study of vBloc Neurometabolic Therapy in obese patients with Type 2 diabetes. The publication, entitled "Vagal Nerve Block for Improvements in Glycemic Control in Obese Patients with Type 2 Diabetes Mellitus: Three-Year Results of the VBLOC DM2 Study," was published in the Journal of Diabetes and Obesity.

 

Medivir AB announced that Christine Lind has been appointed as the new CEO of Medivir AB. She succeeds Niklas Prager, who accepted the role as CEO in 2014 from a position as a Director of the Board when the company faced the need of a corporate transformation. Christine Lind will take up her new position on 1 April 2017, until which time she will continue in her existing role as EVP Strategic Business Development. Niklas Prager will continue as CEO until 1 April and will also make himself available to Christine until the Annual General Meeting on 3 May, in order to ensure an optimal and smooth transition.

 

RepliCel Life Sciences announced the granting of two patents in Europe related to its multi-needle dermal injection technologies.

 

Zynerba Pharmaceuticals announced that the underwriters of its previously announced public offering of 2.8 million shares of its common stock have exercised in full their option to purchase an additional 420,000 shares of common stock at the public offering price of $18.00 per share, less customary underwriting discounts and commissions. With the exercise of the underwriters’ option, gross proceeds to Zynerba from the offering are expected to be approximately $58 million, before deducting underwriting discounts and commissions and other offering expenses payable by Zynerba. The closing of the option exercise is expected to occur on February 13, 2017, subject to customary closing conditions. Jefferies and Piper Jaffray acted as joint book-running managers for the offering. Cantor Fitzgerald acted as lead manager, and Oppenheimer and Roth Capital Partners acted as co-managers for the offering.

 

Sierra Oncology announced that it intends to offer and sell shares of its common stock in an underwritten public offering. All of the shares to be sold in the offering will be offered by Sierra Oncology. The offering is subject to market and other conditions, and there can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering. In addition, Sierra Oncology intends to grant the underwriters a 30-day option to purchase up to an additional 15% of the shares of its common stock offered in the public offering. Jefferies is acting as the sole book-running manager for the offering.

 

 

ANALYST RECOMMENDATIONS

 

Citi analyst Robyn Karnauskas increased her price target of Tesaro to $232 from $151, citing pipeline clarity likely in 2017 and takeout premium.

 

Citi analyst Daniel Arias initiated coverage of Bio-Techne with a “buy” rating and $115 price target, citing the growth run-way given the opportunity at hand, as further top-line acceleration amidst a margin rebound should prove attractive to those looking for solid SMID cap growth names with take-out optionality.

 

Leerink analyst Joseph Schwartz initiated coverage of Spark Therapeutics with an “outperform” rating and $85 price target, citing the company’s deep gene therapy expertise.

 

Credit Suisse analyst Alethia Young initiated coverage of Ascendis Pharma with an “outperform” rating and $28 price target, citing significant upside potential if the company is successful in commercializing its Ph3 asset TransCon hGH, currently being developed for pediatric growth hormone (GH) deficiency.

 

BMO analyst Ian Somaiya decreased his price target of Gilead to $75 from $88, citing 2017 guidance, decline in HCV sales, and uncertainty on when the franchise may stabilize.

 

Stifel analyst Thomas Shrader increased his price target of Acorda to $30 from $28, citing Acorda released CVT-301 data and the primary endpoint was very clearly positive.

 

Following Allergan’s earnings, Leerink analyst Jason Gerberry increased his price target to $280 from $271; Goldman analyst Jami Rubin increased her price target to $260 from $250; Mizuho analyst Irina Koffler increased her price target to $275 from $273; Deutsche Bank analyst Gregg Gilbert increased his price target to $260 from $250; Piper Jaffray analyst David Amsellem increased his price target to $205 from $202; Raymond James analyst Elliot Wilbur increased his price target to $265 from $227; Evercore analyst Umer Raffat increased his price target to $296 from $268; Morgan Stanley analyst David Risinger increased his price target to $284 from $250.