BioShares Biotechnology Clinical Trials (BBC): $19.19, +$0.16, +4.2% YTD

BioShares Biotechnology Products (BBP): $34.30, +$0.37, +4.7% YTD

 

 

MARKET COMMENTARY

 

U.S. stock index futures were higher, with investors basking in the afterglow of a break past 20,000 points for Wall Street’s record high Dow Jones index. Markets will watch for corporate results of major companies such as Starbucks, Microsoft, Intel and Google scheduled to report after the closing bell. Initial claims, Markit composite and services PMI, leading index, new home sales, national activity index, wholesale inventory and goods trade balance data are on the economic calendar. European shares tracked gains in Asian markets. Gold was down as riskier assets gained traction, while oil rose driven by a weakening dollar.

 

 

MARKET HIGHLIGHTS

 

Catalyst Biosciences announced that data from two of its investigational coagulation factors will be presented at the 10th Annual Congress of the European Association of Haemophilia and Allied Disorders (EAHAD) being held in Paris, France from February 1 to 3, 2017. The poster presentations, by Catalyst and its collaborators, will be available for viewing throughout the conference.

 

Rockwell Medical will present data on the Pharmacokinetics of Triferic Administered IV and via HD at the Renal Research Institute 19th International Conference on Dialysis February 1-3, 2017 at Caesar’s Palace in Las Vegas. Triferic is the only FDA approved therapy indicated to replace iron replacement and maintain hemoglobin in chronic kidney disease patients receiving dialysis.

 

BioTime will present a corporate overview at the NobleCon13 – Noble Capital Markets’ Thirteenth Annual Investor Conference at the Boca Raton Resort & Club in Boca Raton, Florida, on Monday, January 30, at 11:00 a.m. Eastern Standard Time.

 

Bioblast Pharma will host a KOL lunch on the subject of orphan neurological diseases and treatments at 12pm on Thursday, February 2, 2017 in New York City.

 

OncoSec Medical Incorporated will present at the NobleCon13 – Noble Capital Markets’ Thirteenth Annual Investor Conference at the Boca Raton Resort & Club in Boca Raton, Florida, on Tuesday, January 31 at 11:30 a.m. EST.

 

Santhera Pharmaceuticals announced preliminary, unaudited key financial figures for 2016. The Company reported net revenues of CHF 19.0 million (+340% year-on-year) from sales of its lead product Raxone® for the treatment of Leber`s hereditary optic neuropathy (LHON). Santhera submitted Marketing Authorization Applications (MAA) for Raxone for the treatment of Duchenne muscular dystrophy (DMD) in the EU and Switzerland and made significant progress in all product development programs. Cash and cash equivalents by year-end amounted to CHF 49.8 million.

 

Celgene reported 4Q16 non-GAAP EPS of $1.61, which compares to $1.18 for the same period a year ago. The company beat the non-GAAP EPS mean estimate of $1.59. Total revenue for 4Q16 was $2.98 billion, which compares to $2.56 billion for the same period a year ago. This compares to a mean estimate of $3.02 billion.

 

Biogen reported 4Q16 non-GAAP EPS of $5.04, which compares to $4.50 for the same period a year ago. The company beat the non-GAAP EPS mean estimate of $4.96. Total revenues for 4Q16 were $2.87 billion, which compares to $2.84 billion for the same period a year ago. This compares to a mean estimate of $2.94 billion.

 

After yesterday’s close, Vertex reported 4Q16 non-GAAP EPS of $0.35, which compares to $0.18 for the same period a year ago. The company beat the non-GAAP EPS mean estimate of $0.29. Total revenue for 4Q16 was $458.7 million, which compares to $417.9 million for the same period a year ago. This compares to a mean estimate of $453.4 million. Following earnings, Leerink analyst Geoffrey Porges increased his price target to $115 from $108; Goldman analyst Terence Flynn decreased his price target to $78 from $81; Jefferies analyst Brian Abrahams decreased his price target to $100 from $104; Stifel analyst Adam Walsh decreased his price target to $100 from $108.

 

Dow Jones reported that Bristol-Myers Squibb slashed its guidance for the year as the drugmaker contends with dimmed prospects for its top cancer drug after major setbacks during the final quarter of the year. For 2017, the company now expects adjusted earnings of $2.70 to $2.90 a share, down from its previous guidance of $2.85 to $3.05. During the fourth quarter, Opdivo sales rose to $1.3 billion, up from $475 million during the period a year earlier. Yervoy sales edged 0.4% lower to $264 million world-wide. Revenue from another key Bristol product, the blood thinner Eliquis, jumped 57% to $948 million globally. In all for the December period, Bristol-Myers Squibb posted earnings of $894 million, or 53 cents a share, compared with a loss of $197 million, or 12 cents a share, a year earlier. The 2015 results included after-tax charges of 24 cents a share from the Five Prime Therapeutics and Cardioxyl Pharmaceuticals business development transactions and 8 cents a share for the transfer of the Erbitux business in North America to Eli Lilly. Excluding certain items, adjusted earnings rose to 63 cents a share from 38 cents. Revenue surged 22%, to $5.24 billion. Analysts polled by Thomson Reuters had predicted earnings of 67 cents a share on $5.13 billion in revenue.

 

Johnson & Johnson and Actelion announced that they have entered into a definitive transaction agreement under which Johnson & Johnson will launch an all-cash tender offer in Switzerland to acquire all of the outstanding shares of Actelion for $280 per share, payable in U.S. dollars, which equates to CHF 280.08 per share as of January 25, 2017. The transaction, which was unanimously approved by the Boards of Directors of both companies, is expected to be immediately accretive to Johnson & Johnson adjusted earnings per share and accelerate Johnson & Johnson revenue and earnings growth rates. Johnson & Johnson will fund the transaction with cash held outside the U.S.

 

Pfizer announced that the Phase II study evaluating the Company’s Clostridium difficile (C. difficile) vaccine candidate, PF-06425090, provided positive data, based on a pre-planned interim analysis. The randomized Phase II study (NCT02561195) examined the safety, tolerability, and immunogenicity of the vaccine in healthy adults 65 to 85 years of age. Pfizer’s vaccine candidate is designed to help prevent C. difficile infection (CDI), which can include life-threatening diarrhea and pseudomembranous colitis, by inducing a functional antibody response capable of neutralizing the two main disease-causing toxins produced by C. difficile (toxins A and B).

 

Auris Medical Holding announced that it has resumed patient enrollment in the TACTT3 Phase III trial of Keyzilen (AM-101) in acute and post-acute inner ear tinnitus.

 

The European Commission has approved an update to the Jardiance (empagliflozin) label to include a change to the indication statement. Jardiance is now indicated for the treatment of adults with insufficiently controlled Type II diabetes mellitus (T2D) as an adjunct to diet and exercise. The approved product information now includes data on the reduction of risk of cardiovascular (CV) death in patients with T2D and established CV disease in addition to data on the improvement of blood sugar control. Jardiance is the only oral diabetes treatment shown to reduce the risk of CV death in a dedicated CV outcome trial to date. Jardiance is marketed by Boehringer Ingelheim and Eli Lilly.

 

Endo International announced today that as part of its comprehensive organizational review, it has initiated a restructuring program.  These restructuring actions primarily relate to the Company’s Corporate functions and Branded pharmaceutical R&D functions in Malvern, PA and Chestnut Ridge, NY.  The restructuring program will better align these parts of our organization in size and scope with the Company’s recently restructured Generics and U.S Branded Pharmaceutical business units.  In addition to realizing greater efficiencies, these actions are expected to provide corresponding cost savings.  Endo expects to invest a portion of these cost savings in the Company’s core product franchises and new product development programs for both the Branded and Generics business segments. 

 

Verastem announced dosing of the first patient in a new clinical trial evaluating avelumab, an investigational fully human anti-PD-L1 IgG1 monoclonal antibody, in combination with Verastem’s defactinib, an investigational focal adhesion kinase (FAK) inhibitor, in patients with advanced ovarian cancer. The Phase I/II clinical trial is being conducted in collaboration with the alliance between Merck which in the US and Canada operates as EMD Serono, and Pfizer, and is expected to enroll approximately 100 patients at up to 15 sites across the U.S.

 

Celgene and Delinia announced that they have entered into an agreement for the acquisition of Delinia by Celgene. The transaction expands Celgene’s Inflammation and Immunology pipeline through the acquisition of Delinia’s lead program, DEL106, as well as related second generation programs. DEL106 is a novel IL-2 mutein Fc fusion protein designed to preferentially upregulate regulatory T cells (Tregs), immune cells that are critical to maintaining natural self-tolerance and immune system homeostasis. Augmenting Tregs as a means of restoring immune system balance has the potential to benefit patients with a variety of autoimmune diseases such as systemic lupus erythematosus and rheumatoid arthritis.

 

Ironwood Pharmaceuticals and Allergan announced that the FDA has approved a 72 mcg dose of LINZESS (linaclotide) for the treatment of chronic idiopathic constipation (CIC) in adult patients.

 

Ablynx announced that its partner, Merck KGaA, has reported encouraging results from a study in psoriasis patients with the bi-specific Nanobody anti-IL-17A/F (M1095), via a clinical trials website. The trial was conducted in 41 patients with moderate-to-severe psoriasis with multiple ascending subcutaneous doses ranging from 30mg to 240mg administered on days 1, 15 and 29. The primary endpoints were safety, tolerability, immunogenicity and pharmacokinetics. Secondary endpoints were pharmacodynamics and efficacy. The doses of M1095 were well tolerated. No dose-dependent treatment-emergent adverse events were observed. Pharmacokinetic profiles demonstrated dose proportionality with the expected terminal half-life of ~11-12 days. There was no apparent effect of anti-drug antibodies on pharmacokinetics.

 

Affimed announced the closing of its previously announced public offering of 10,000,000 of its common shares at a public offering price of $1.80 per common share. The Company has granted the underwriters a 30-day option to purchase up to an additional 1,500,000 shares of its common stock. After deducting the underwriting discounts and other estimated offering expenses, the net proceeds of the public offering are expected to be approximately $16.6 million. BMO Capital Markets and Wells Fargo Securities are acting as joint book-running managers, and Trout Capital is acting as co-manager.

 

Pluristem Therapeutics announced that H.C. Wainwright & Co., the sole book-running manager of its previously announced bought offering of 12,244,898 shares of common stock and warrants to purchase up to 7,346,939 shares of its common stock, has exercised in full its over-allotment option to purchase an additional 1,836,735 shares of common stock and warrants to purchase an additional 1,102,041 shares of common stock at the public offering price of US$1.225 per share and associated warrant. After taking into account the Over-Allotment Option being exercised in full, the aggregate gross proceeds to the Company (assuming no exercise of the warrants) in the bought offering were US$17.25 million, before deducting underwriting discounts and commissions and other offering expenses. The closing of the bought offering, including the Over-Allotment Option, occurred on January 25, 2017.

 

Relmada Therapeutics announced that the IND application for d-Methadone (REL-1017 dextromethadone), the company’s novel, N-methyl-D-aspartate (NMDA) receptor antagonist, has been cleared by the FDA. The company is now authorized to advance the development program for d-Methadone to a Phase IIa proof of concept clinical study in patients with treatment resistant depression (TRD).

 

AnaptysBio announced the pricing of its initial public offering of 5,000,000 shares of its common stock at a public offering price of $15 per share. The shares are expected to begin trading on The NASDAQ Global Select Market on January 26, 2017, under the symbol "ANAB." In addition, AnaptysBio has granted the underwriters a 30-day option to purchase up to an additional 750,000 shares of common stock. The offering is expected to close on January 31, 2017, subject to customary closing conditions. Credit Suisse and Stifel are acting as joint book-running managers for the offering. JMP Securities and Wedbush PacGrow are acting as co-managers.

 

ObsEva SA announced the pricing of its initial public offering of 6,450,000 common shares at the initial public offering price of $15.00 per share. In addition, ObsEva has granted the underwriters an option to purchase up to 967,500 additional common shares to cover over-allotments. ObsEva’s common shares have been approved for listing on The NASDAQ Global Select Market and are expected to begin trading under the ticker symbol "OBSV" on January 26, 2017.  Credit Suisse Securities, Jefferies and Leerink Partners are acting as joint book-running managers for the proposed offering.

 

QIAGEN announced the adjustment of the conversion ratio under its 0.375% Senior Unsecured Convertible Notes due 2019. The adjusted conversion ratio of 7,063.1647 (from previously 7,334.8249) became effective as of January 25 2017.  The conversion ratio was adjusted in accordance with the terms and conditions of the Notes to reflect the impact of a synthetic share repurchase, which combines a direct capital repayment with a reverse stock split. The synthetic share repurchase, which was announced in August 2016 and approved in October 2016 at an Extraordinary General Meeting of Shareholders, involves an approach used by various large, multinational Dutch companies as an efficient way to provide returns to all shareholders, and to do so in a faster and more efficient way than through a traditional open-market share repurchase program.

 

Pharming Group announced that it has issued 10,823,881 new shares to holders of the Amortizing Bonds due 2017/8 who have converted some of their Bonds into shares ahead of the due date for payment of the first instalment on those Bonds.  Most of these conversions will be credited against the scheduled first instalment of the Bonds, due on 1 February 2017, reducing the cash due from the Company.

 

Aduro Biotech announced the appointment of five key opinion leaders to its scientific advisory board, who join four existing leading clinicians, researchers and scientists. Newly appointed members include: Thomas Gajewski, M.D., Ph.D., Darren Higgins, Ph.D., F. Stephen Hodi, M.D., Wiebe Olijve, Ph.D., and David H. Raulet, Ph.D.

 

venBio Select Advisor, the beneficial owner of approximately 10.5 million shares, or 9.9%, of Immunomedics, and its largest stockholder, released a presentation titled: "The Case for Change at Immunomedics, Inc."

 

 

ANALYST RECOMMENDATIONS

 

Chardan analyst Gbola Amusa increased his price target of Avexis to $100 from $85, citing efficacy and safety issues for Spinraza relative to AVXS-101.

 

The following analysts decreased their price target of Endo International, citing steeper U.S. base generics decline in 2017: Susquehanna analyst Andrew Finkelstein decreased his price target to $18 from $20; Morgan Stanley analyst David Risinger decreased his price target to $13 from $15.

 

Piper Jaffray analyst Joshua Schimmer upgraded Clovis Oncology to “overweight” from “neutral” and increased his price target to $77 from $43, citing the total market potential for PARP inhibitors to supplant platinum therapy well beyond ovarian or breast cancer and define new combinations broadly in oncology.

 

Mizuho analyst Irina Koffler increased her price target of Pacira Pharmaceuticals to $50 from $41, citing the commercial JNJ partnership increases its eventual probability of takeout and should drive higher Exparel sales volumes.

 

Wells Fargo analyst Larry Biegelsen downgraded Johnson & Johnson to “market perform” from “outperform,” citing disappointing 2017 revenue guidance the company provided on 1/24 which suggests the company’s pharma business is facing more headwinds in 2017 than expected.