BioShares Biotechnology Clinical Trials (BBC): $22.92, +$0.61, +24.5% YTD

BioShares Biotechnology Products (BBP): $37.98, +$0.26, +16.0% YTD

 

 

MARKET COMMENTARY

 

Global markets fell as bets on rising interest rates dampened market sentiment and bludgeoned commodity markets struggled to find a footing. Jobless claims, import and export prices data are slated for release later in the day. The dollar hit a three-week high against the yen after a strong U.S. private jobs report. Oil prices fell, extending its previous session’s slump as U.S. crude inventories ballooned to a record high. Gold hit a five-week low. 

 

 

MARKET HIGHLIGHTS

 

Aurinia Pharmaceuticals released its financial results for the fourth quarter and year ended December 31, 2016. Amounts, unless specified otherwise, are expressed in U.S. dollars.  For the year ended December 31, 2016, the Company recorded a consolidated net loss of $23.3 million or $0.66 per common share, as compared to a consolidated net loss of $18.6 million or $0.58 per common share in 2015.  In 2016, the Company raised net proceeds of $40.6 million from equity financings and received $2.0 million from the exercise of warrants and options. As a result, at December 31, 2016 the Company had cash of $39.6 million and working capital of $33.5 million.

 

Neovacs announced that Géraldine Grouard-Vogel, PhD., Chief Scientific Officer of Neovacs, will present an update on the Company’s IFNα Kinoid program in Lupus, Dermatomyositis and Type 1 Diabetes, at the 2017 Keystone Symposia Conference, taking place March 19 – 23, 2017, in Banff, Alberta, Canada. 

 

CymaBay Therapeutics will provide a corporate overview at the 29th Annual ROTH Conference on Monday, March 13th @ 5pm Pacific Time, and the Oppenheimer 27th Annual Healthcare Conference on Tuesday, March 21st.

 

BioDelivery Sciences International will report its fourth quarter and full-year 2016 financial results and host a conference call and webcast at 8:00 AM Eastern Time on Friday, March 17, 2017.

 

TiGenix NV announced week 104 data from the Cx601 ADMIRE-CD study, a pivotal Phase III trial for complex perianal fistulas in Crohn’s disease patients.  The ADMIRE-CD trial was a randomized, double-blind, placebo-controlled Phase III study designed to confirm the efficacy and safety of a single administration of Cx601 in the treatment of complex perianal fistulas in Crohn’s disease patients. Out of the 212 patients randomized, 37 patients concluded the long term extension from week 52 to week 104, i.e. 23 patients in the Cx601 arm and 14 in the placebo (control) arm. This long term extension was done to confirm the long term safety and tolerability of Cx601.  The topline data of this second year of follow up indicate the following:  the Clinical remission rate and difference between groups, as was previously observed at week 24 and week 52, was maintained at week 104; the tolerability of Cx601 was maintained; the safety profiles of Cx601 and placebo (control) were similar for the duration of the trial; and, no new safety signals were reported during the 2 years extended follow up.

 

PolyPid announced interim results from the first group of patients having reached the six-month follow-up period in the Company’s confirmatory clinical trial of BonyPid-1000, a doxycycline-eluting synthetic bone substitute (ß tri-calcium phosphate ((ß) TCP) granules). The BonyPid-1000-103 trial is a randomized, single-blind standard of care controlled study in a total of 64 patients with open tibia fractures (Gustilo IIIA and IIIB), a severe clinical condition resulting from a high energy traumatic event where the bone is severely damaged and exposed and, therefore, assumed to be contaminated by environmental bacteria. This multi-center study is being conducted at six clinical sites in Israel and three in Asia. The objective of the study is to determine performance and safety of standard of care (SOC) plus BonyPid-1000 on bone healing in traumatic open fracture patients over a period of six and 12 months, compared with SOC alone. The primary performance endpoint is radiographic-assessed bone healing during the 24-week follow-up period, based on independent blinded central radiographic evaluations of the target fracture’s x-rays.

 

Apricus Biosciences announced that it completed the sale to Ferring International Center S.A. of Apricus’ ex-U.S. assets and rights related to Vitaros. Ferring is Apricus’ existing commercialization partner for Vitaros in Latin America and certain parts of Europe and Asia. Apricus will retain its Vitaros rights in the U.S. and it remains on track to re-submit the Vitaros NDA to the FDA in the third quarter of 2017.

 

Spectrum Pharmaceuticals reported Q4 revenues were $35.2 million, including $32.2 million in product sales. During the quarter the Company purchased $10.0 million face value of its convertible debentures for $9.0 million. The Company ended the quarter with cash and cash equivalents of $158 million.

 

Boehringer Ingelheim announced that the FDA has granted orphan drug designation to its anti-CD33 monoclonal antibody BI 836858 for the treatment of myelodysplastic syndromes (MDS). Orphan drug designation is granted by the FDA to investigational compounds intended for the safe and effective treatment, diagnosis, or prevention of rare diseases or disorders that affect fewer than 200,000 people.

 

InVivo Therapeutics Holdings announced that a new patient has been enrolled into The INSPIRE Study (InVivo Study of Probable Benefit of the Neuro-Spinal Scaffold for Safety and Neurologic Recovery in Subjects with Complete Thoracic AIS A Spinal Cord Injury) at the Keck Hospital of University of Southern California (USC). Patrick Hsieh, M.D., Principal Investigator at this site, performed the implantation approximately 82 hours after the injury occurred.

 

CEL-SCI announced it has entered into a definitive agreement with institutional investors for an offering of shares of common stock with gross proceeds of approximately $1.5 million in a registered direct offering. The closing of the offering is expected to take place on or about March 14, 2017, subject to the satisfaction of customary closing conditions.

 

Ironwood Pharmaceuticals is hosting an R&D Day. During the event, the company will present its progress delivering innovative medicines to patients and building a top-performing commercial biotech, with a focus on clinical and commercial strategies for three key pipeline programs: IW-3718 for uncontrolled gastroesophageal reflux disease (uGERD); IW-1973 for resistant hypertension (rHTN), heart failure with preserved ejection fraction (HFpEF) and diabetic nephropathy (DN); and linaclotide delayed release-1 (DR1) for irritable bowel syndrome with constipation (IBS-C).

 

Epizyme announced that President of Research and Chief Scientific Officer, Robert A. Copeland, Ph.D., will be retiring from Epizyme in the second quarter of 2017 to pursue advisory and other opportunities within the industry. Dr. Copeland has served in his role since 2008, and will remain a key advisor to Epizyme following his transition. The Company is executing plans for continued growth of its investigational pipeline, with plans to name its next development candidate in 2017 as part of its goal of delivering three new candidates into the clinic by 2020.

 

Valeant Pharmaceuticals International announced that it has launched an offering of $2.5 billion aggregate principal amount of senior secured notes (the "Notes") in two tranches, one of which would mature in 2022 and one in 2024. The offering of Notes is being conducted in connection with the Company’s previously announced refinancing and amendment of its existing credit agreement (the "Refinancing"). The net proceeds of the offering together with the proceeds from a new term loan in connection with the Refinancing are expected to be used to repay certain loans outstanding under the Company’s credit facilities and to finance a tender offer for up to $600 million principal amount of the Company’s outstanding 6.75% Senior Notes due 2018 (the "Tender Offer").

 

Mersana Therapeutics announced that it was awarded EP Patent No. 2717916 B1, entitled “Protein-Polymer-Drug Conjugates.” This patent provides Mersana comprehensive coverage in the European Union for its polymer-based Fleximer-ADC platform technology. The patent covers Fleximer-antibody drug conjugates and their methods of use as well as Fleximer-drug conjugates that can be linked to an antibody or antibody alternative to create next-generation antibody drug conjugates. The patent also has claims directed to Mersana’s proprietary auristatin payload.

 

Opiant Pharmaceuticals announced that its most recently issued U.S. patents, numbers 9,480,644 and 9,561,177 covering methods of use for NARCAN Nasal Spray (“NARCAN”), are now listed in the FDA publication, Approved Drug Products with Therapeutic Equivalence Evaluations, commonly known as the Orange Book.

 

Neuralstem announced the recent publication of preclinical data on NSI-566 spinal cord-derived neural stem cells in Journal of Neurotrauma.  These data showed robust engraftment and long-term survival of NSI-566 post transplantation in a rat model of penetrating ballistic-like brain injury (PBBI).  NSI-566 is Neuralstem’s lead stem cell therapy candidate.

 

Galena Biopharma announced it has engaged Canaccord Genuity as its financial advisor to assist in the previously announced strategic alternative review process.

 

Servier, together with Pfizer and Cellectis, announced that the FDA has granted Servier with an IND clearance to proceed in the U.S. with the clinical development of UCART19, an allogeneic, gene-edited cellular therapy candidate to treat relapsed/refractory acute lymphoblastic leukemia. Servier is sponsoring the CALM Phase I study on UCART19. In 2015, Servier acquired exclusive rights from Cellectis for UCART19, which is being co-developed by Servier and Pfizer.

 

TG Therapeutics announced that it intends to offer and sell, subject to market conditions, shares of its common stock in an underwritten public offering. In addition, TG Therapeutics 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 sole book-running manager for the offering. TG Therapeutics intends to use the net proceeds of this offering to fund the ongoing development of TG-1101 and TGR-1202, to potentially in-license, acquire, develop and commercialize additional drug candidates, for research and development activities and for general corporate purposes.

 

Retrophin initiated a plan to consolidate its operations to its corporate headquarters in San Diego, CA. As part of this plan, select employees will relocate from Cambridge, MA to the San Diego headquarters by the end of 2017 and replacements for other functions will be hired during the course of 2017. The Company intends to close its Cambridge, MA office by the end of 2017. This action is being taken as part of a strategic effort to centralize expertise and improve efficiency, with the goal of expediting the development of the Company’s late-stage clinical and early stage research programs. The Company estimates it could incur up to $4.5 million in employee related separation and transitional cash charges as a result of this consolidation.

 

BONE THERAPEUTICS announces that it has completed the recruitment of the first 16 patients in its Phase I/IIA delayed-union study of its allogeneic cell therapy product ALLOB.

 

BioCryst Pharmaceuticals announced that it is offering to sell $45.0 million of its common stock in an underwritten public offering. As part of this offering, BioCryst intends to grant the underwriters a 30-day option to purchase up to an additional $6.75 million of its common stock. The offering is subject to market conditions, and there can be no assurance as to whether or when the offering may be completed, or the actual size or terms of the offering. J.P. Morgan Securities LLC is acting as sole book-running manager for the proposed offering.

 

 

ANALYST RECOMMENDATIONS

 

Leerink analyst Joseph Schwartz downgraded Ascendis Pharma to “market perform” from “outperform” and increased his price target to $30 from $24, citing the recent outperformance in shares.

 

Raymond James analyst Elliot Wilbur downgraded Aerie Pharmaceuticals to “market perform” from “strong buy”, citing that while the analyst have not altered his peak sales or launch timing and penetration assumptions for Rhopressa or Roclatan, shares no longer offer as compelling reward/risk scenarios pending the expected launch of Rhopressa in 2Q18.

 

Following Sucampo’s earnings, Mizuho analyst Irina Koffler decreased her price target to $14 from $16; Jefferies analyst David Steinberg decreased his price target to $14 from $16.

 

Morgan Stanley analyst David Risinger decreased his price target of Endo International to $12 from $13, citing reduced estimates following 4Q results.

 

Leerink analyst Paul Matteis revised his price target of the following companies: Alnylam increased to $50 from $45; Ionis decreased to $48 from $49.

 

Credit Suisse analyst Vamil Divan revised his price target of the following companies: Allergan increased to $281 from $274; Galapagos increased to €72 from €56; Versartis increased to $29 from $24.

 

Jefferies analyst Jeffery Holford revised his price target of the following Pharma companies: Abbott increased to $52 from $51; AstraZeneca increased to 5,350p from 5,250p; Bristol-Myers increased to $66 from $64; Eli Lilly increased to $97 from $95; GlaxoSmithKline increased to 1,900p from 1,800p; Johnson & Johnson increased to $132 from $125; Merck increased to $52 from $50; Novartis increased to CHF95 from CHF93.

 

Following Flex Pharma’s earnings, Jefferies analyst Matthew Andrew decreased his price target to $9 from $11; Piper Jaffray analyst Joshua Schimmer decreased his price target to $12 from $15.

 

UBS analyst Carter Gould initiated coverage of the following companies: Regeneron Pharmaceuticals with a “buy” rating and $435 price target; Acceleron Pharma with a “buy” rating and $36 price target; Biogen with a “sell” rating and $260 price target; Celgene with a “buy” rating and $140 price target; Vertex with a “buy” rating and $106 price target; Incyte with a “neutral” rating and $140 price target; Amgen with a “neutral” rating and $185 price target. Coverage of the following was transferred to Carter Gould: Gilead with a “neutral” rating (from “buy”) and $72 price target (down from $118).