BioShares Biotechnology Clinical Trials (BBC): $21.67, +$0.32, +17.7% YTD

BioShares Biotechnology Products (BBP): $36.99, -$0.19, 12.9% YTD

 

 

MARKET COMMENTARY

 

U.S. stock index futures were slightly lower ahead of a set of earnings from big U.S. retailers, including Macy’s, amid a risk-off mood in the market after President Donald Trump’s decision to fire his FBI chief. On the economic front, investors will look forward to producer prices and weekly jobs data. European shares underperformed as investors looked to lock in gains after their strong run so far this year. Asian markets rose with Japan’s Nikkei hitting its highest level since December 2015, helped by strong earnings from Softbank and weakness in yen. Oil prices rose after a fall in U.S. inventories and a bigger-than-expected cut in Saudi supplies to Asia helped tighten the market. Gold edged up as the U.S. dollar weakened, although the prospect of a U.S. rate increase in June kept prices just above eight-week lows hit earlier this week.

 

 

MARKET HIGHLIGHTS

 

TRACON Pharmaceuticals announced financial results for the first quarter ended March 31, 2017.  The net loss for the first quarter of 2017 was $7.1 million, compared to a net loss of $6.5 million for the first quarter of 2016.  Cash, cash equivalents and short-term investments were $36.7 million at March 31, 2017, compared to $44.4 million at December 31, 2016.

 

DURECT Corporation announced financial results for the three months ended March 31, 2017.  Total revenues were $4.6 million and net loss was $8.1 million for the three months ended March 31, 2017 as compared to total revenues of $3.6 million and net loss of $7.8 million for the three months ended March 31, 2016.  At March 31, 2017, cash and investments were $16.8 million, compared to cash and investments of $25.2 million at December 31, 2016. Including the upfront license fee from Sandoz less a fee owed to an advisory firm, our pro forma cash and investments at March 31, 2017 would have been approximately $36.1 million. Debt at March 31, 2017 was $19.9 million.

 

SciClone Pharmaceuticals reported financial results for the quarter ended March 31, 2017.  In the first quarter 2017, SciClone reported revenues of $42.9 million, compared to $36.5 million for the same period in 2016.  In the first quarter 2017, SciClone reported GAAP diluted earnings per share of $0.28, compared to $0.15 for the same period in 2016.  As of March 31, 2017, cash and cash equivalents totaled $141.3 million, compared to $134.4 million as of December 31, 2016.

 

Albireo Pharma reported its financial results for the first quarter ended March 31, 2017.  Albireo reported a net loss of $6.7 million for the quarter ended March 31, 2017, compared with a net loss of $3.2 million for the corresponding 2016 period. As of March 31, 2017, cash and cash equivalents totaled $20.1 million.

 

BioTime reported financial results for the first quarter ended March 31, 2017.  Net income attributable to BioTime was $49.3 million, or $0.46 per basic and diluted common share for the three months ended March 31, 2017, compared to net loss of $17.1 million, or ($0.19) per basic and diluted common share.  Cash and cash equivalents totaled $23.8 million as of March 31, 2017, compared to $22.1 million as of December 31, 2016, which included OncoCyte’s cash and cash equivalents of $10.2 million.

 

Onxeo has received a Notice of Allowance from the U.S. Patent and Trademark Office for a patent application covering the specific route of administration for Livatag®, which is currently in a phase III clinical trial (ReLive) for the second-line treatment of hepatocellular carcinoma (primary liver cancer).

 

GeNeuro reported on its cash and revenues for the first quarter 2017.  GeNeuro recognised operating revenues of €1.6 million over the first three months of 2017, an increase of 64% compared with the same period in 2016.  As of March 31, 2017, cash and cash equivalents totalled €27.3 million.

 

TherapeuticsMD will present at the Bank of America Merrill Lynch 2017 Healthcare Conference in Las Vegas on May 16.

 

Catalyst Biosciences announced financial results for the first quarter ended March 31, 2017. Net loss for the three months ended March 31, 2017 was $4.1 million, or ($4.57) per basic and diluted share, compared with $3.6 million, or ($4.71) per basic and diluted share, for the prior year period.  Cash, cash equivalents and short-term investments as of March 31, 2017 were $14.5 million, not including the $20.7 million raised through the underwritten public equity offering and $3.5 million raised through the Company’s at-the-market offering program with JonesTrading. The Company believes that its existing capital resources will be sufficient to meet its projected operating requirements for at least the next 12 months.

 

Aimmune Therapeutics announced the enrollment of its first patient in the Phase 3 RAMSES (ARC007) clinical trial of AR101 for treatment of peanut allergy.  AR101 is Aimmune’s investigational biologic oral immunotherapy for desensitization of patients with peanut allergy.  The Real-World AR101 Market-Supporting Experience Study in Peanut-Allergic Children Age 4-17 Years, or RAMSES (ARC007), trial is designed to gain experience with AR101 in a real-world setting, without the use of a double-blind, placebo-controlled food challenge (DBPCFC) to confirm peanut allergy. It will assess the safety and tolerability of AR101 versus placebo. The trial follows the same up-dosing and maintenance protocol as Aimmune’s ongoing Phase 3 PALISADE trial, taking place in the United States, Canada, and eight countries in Europe.

 

BIOPHYTIS has received the approval from the US regulatory authorities for the recruitment of sarcopenia patients in the observational study SARA-OBS on Sarconeos. It has therefore been able to open the two clinical centers and start the recruitment of sarcopenia patients in the United States. These patients, if they give their consent, could participate in the clinical trial of phase 2b SARA-INT, on Sarconeos.

 

Vermillion reported its financial results for the first quarter ended March 31, 2017.  Net loss for the first quarter of 2017 was $2.7 million or $(0.05) per share, as compared to a net loss of $4.9 million or $(0.09) per share in the same year-ago quarter.  As of March 31, 2017, cash and equivalents totaled $7.9 million, including the $5.1 million in net proceeds from our private placement of common stock and warrants in February 2017.

 

Palatin Technologies will announce its third quarter, fiscal year 2017 operating results on Tuesday, May 16, 2017  before the open of the U.S. financial markets.

BioTime announced that a poster related to the Company’s retinal restoration technology was presented at the Annual Meeting of the Association for Research in Vision and Ophthalmology (ARVO) in Baltimore, Maryland on May 11, 2017.

 

VBL Therapeutics announced new preclinical data indicating that treatment with ofranergene obadenovec (VB-111) augments the anti-tumor activity of a PD-L1 blocker in lung cancer and melanoma models. The data will be presented tomorrow, May 12, in a poster session at the 20th Annual Meeting of the American Society of Gene & Cell Therapy (ASGCT), taking place in Washington, DC.

 

OncoSec Medical Incorporated will host its fiscal third quarter 2017 financial results conference call on Thursday, June 1 at 4:15 PM Eastern Time.

 

Zealand Pharma A/S and Boehringer Ingelheim GmbH have demonstrated that the novel long-acting amylin analogue ZP4982 prevents the development of obesity in preclinical models, suggesting its potential use in treating obesity and obesity-related comorbidities. Zealand and Boehringer Ingelheim will jointly present these data at the Keystone Symposia `Neuronal Control of Appetite, Metabolism and Weight/Gastrointestinal Control of Metabolism` on Friday May 12 in Copenhagen, Denmark.

 

TiGenix NV will be presenting at the Bank of America Merrill Lynch 2017 Healthcare Conference in Las Vegas on Thursday, May 18.

 

Valneva SE reported today its consolidated financial results for the first quarter ended March 31, 2017.  Valneva’s aggregate first quarter 2017 revenues and grants were €29.1 million compared to €24.7 million in the first quarter of 2016.  Valneva’s net loss in the first quarter of 2017 was €1.7 million compared to a net loss of €5.0 million in the first quarter of the prior year.  Liquid funds on March 31, 2017 stood at €45.2 million compared to €42.2 million on December 31, 2016 and consisted of €41.5 million in cash and cash equivalents and €3.7 million in restricted cash.

 

DelMar Pharmaceuticals announced the formalization of an agreement with PRA Health Sciences, a leading contract research organization (CRO) to conduct the Company’s Phase 3 trial of VAL-083 in recurrent glioblastoma multiforme (GBM).

 

Synthetic Biologics announced that the FDA has granted a Breakthrough Therapy Designation for SYN-004 (ribaxamase) for the prevention of Clostridium difficile infection. SYN-004 (ribaxamase) is the Company’s first-in-class oral enzyme designed to protect the gut microbiome from disruption caused by certain intravenous (IV) beta-lactam antibiotics.

 

After yesterday’s close, Intrexon reported 1Q17 GAAP EPS loss of $0.26, which compares to a loss of $0.55 for the same period a year ago. The company missed the GAAP EPS mean estimate loss of $0.25. Total revenue for 1Q17 was $53.7 million, which compares to $43.4 million for the same period a year ago. This compares to a mean estimate of $49.1 million.

 

Asterias Biotherapeutics announced new positive serial magnetic resonance imaging (MRI) data from its ongoing AST-OPC1 SCiStar Phase I/IIa clinical trial in patients with severe spinal cord injury.

 

Merck announced that the FDA has approved KEYTRUDA (pembrolizumab), the company’s anti-PD-1 therapy, in combination with pemetrexed (brand name Alimta) and carboplatin (pem/carbo), a commonly used chemotherapy regimen, for the first-line treatment of metastatic nonsquamous NSCLC, irrespective of PD-L1 expression. Under the FDA’s accelerated approval regulations, this indication is approved based on tumor response rate and progression-free survival (PFS). Continued approval for this indication may be contingent upon verification and description of clinical benefit in the confirmatory trials.

 

Sangamo Therapeutics and Pfizer announced an exclusive, global collaboration and license agreement for the development and commercialization of gene therapy programs for Hemophilia A, including SB-525, one of Sangamo’s four lead product candidates, which Sangamo expects will enter the clinic this quarter.

 

Intellipharmaceutics International announced that it has received final approval from the FDA for the Company’s ANDA for quetiapine fumarate extended-release tablets in the 50, 150, 200, 300 and 400 mg strengths. This approval follows the expiry of 180-day exclusivity periods granted to the first filers of generic equivalents to the branded product, as previously disclosed by the Company. The approved product is a generic equivalent of the branded product Seroquel XR sold in the U.S. by Astra Zeneca Pharmaceuticals LP.

 

Astellas Pharma announced the discontinuation of ASP8273 treatment arm in the the late-stage SOLAR trial evaluating the efficacy and safety of ASP8273 versus erlotinib/gefitinib for the 1st line treatment metastatic or advanced unresectable non-small cell lung cancer (NSCLC) harboring sensitizing epidermal growth factor receptor (EGFR) mutation. Following a recommendation by the trial’s Independent Data Monitoring Committee (IDMC), Astellas is voluntarily closing study randomization and is informing investigators that ASP8273 treatment must be discontinued. Astellas is also planning to terminate future development programs for ASP8273 in NSCLC following its governance process.

 

TESARO and Clinigen Group’s Idis Managed Access division have partnered to launch a Managed Access Program (also known as an Early Access Program) in Europe for the investigational PARP 1/2 inhibitor, niraparib, for patients with recurrent ovarian cancer. Niraparib is currently an investigational agent in Europe and as such has not been granted approval by the EC. The niraparib marketing authorization application is under review by the EMA.

 

Celyad announced that the FDA has granted Fast Track designation for its C-Cure therapy. FDA granted Fast Track designation for reduction in mortality, hospitalization and improvement of quality of life in patients with chronic heart failure secondary to ischemic cardiomyopathy with baseline Left Ventricular End-Diastolic Volumes (LVEDV) between 200 and 370ml as Fast Track Development Program.

 

Cellectis announced that U.S. patent 8,921,332, which claims the use of chimeric restriction endonucleases for directing chromosomal gene editing in cells by homologous recombination (HR), initially issued on Dec. 30, 2014, has been upheld by the USPTO after a reexamination initiated in October 2015.

 

Corbus Pharmaceuticals Holdings announced that subject enrollment is complete in its Phase II clinical study of anabasum (formerly known as JBT-101) for the treatment of skin-predominant dermatomyositis. The Company expects topline results from this study to be available in the fourth quarter of 2017. This single-center Phase II study is being conducted at the University of Pennsylvania School of Medicine and is funded by a grant from the National Institute of Arthritis and Musculoskeletal and Skin Diseases of the National Institutes of Health.

 

Ocular Therapeutix presented ocular pain data from a pooled analysis from three Phase III clinical trials evaluating the efficacy and safety of DEXTENZA (dexamethasone insert) 0.4 mg for intracanalicular use, for the treatment of ocular pain and inflammation following cataract surgery, at the Association for Research in Vision and Ophthalmology (ARVO) Annual Meeting in Baltimore, MD. The FDA has set a target action date under the PDUFA of July 19, 2017 for a decision regarding the potential approval of DEXTENZA. The upcoming PDUFA date is for a NDA for the treatment of ocular pain following ophthalmic surgery based on a Phase II study and two Phase III trials. The third and most recent Phase III study results are not currently being evaluated by FDA as part of the current NDA. The pooled analysis includes data from all three Phase III trials, in which 79% percent of DEXTENZA patients reported no pain at Day 8 compared to 56.9% of the placebo patients. Across all three Phase III trials, a greater proportion of placebo patients experienced at least one ocular adverse event (AE) as compared with DEXTENZA patients. The most frequent ocular AEs were anterior chamber inflammation, increased intraocular pressure, corneal edema, and eye inflammation. There were no treatment-related serious adverse events (SAEs) in either group.

 

Xencor announced that XmAb5871 has been granted orphan drug designation by the FDA for the treatment of IgG4-Related Disease (IgG4-RD), a newly defined fibro-inflammatory autoimmune disorder that is estimated to impact up to 40,000 patients in the United States.

 

Veracyte announced that data demonstrating the cost-effectiveness of the Percepta Bronchial Genomic Classifier were published for the first time in the Journal of Thoracic Oncology. These data suggest that use of the Percepta classifier in lung cancer screening and diagnosis can meaningfully reduce invasive procedures and associated costs, and is cost-effective across a range of assumptions.

 

Kadmon Holdings announced the presentation of data from its completed Phase II clinical trial of KD025, the Company’s oral Rho-associated coiled-coil kinase 2 (“ROCK2”) inhibitor, in patients with moderate to severe psoriasis, as well as new preclinical data demonstrating the importance of ROCK2 signaling in regulating the pro-inflammatory aspect of immune response. The data will be presented in oral and poster presentations at the American Association of Immunologists (AAI) Annual Meeting, taking place May 12-16, 2017, in Washington, D.C.

 

Lexicon Pharmaceuticals announced additional positive data from the Phase III inTandem1 study. It was previously announced that both doses of sotagliflozin achieved the primary endpoint of the inTandem1 study, showing statistically significant reductions in A1C at 24 weeks in patients with type 1 diabetes on a background of optimized insulin. New key findings include meaningful benefit of sotagliflozin on body weight in patients with type 1 diabetes and on systolic blood pressure in hypertensive patients with type 1 diabetes. In addition, the Company announced achievement of important secondary endpoints including net benefit, bolus insulin use, fasting plasma glucose and patient reported outcomes.

 

GTx announced the acceptance of an abstract on preliminary clinical data from its ongoing, open-label, Phase II proof-of-concept clinical trial of enobosarm (GTx-024) evaluating enobosarm 3 mg in postmenopausal women with stress urinary incontinence (SUI). The clinical trial is the first study evaluating an orally administered selective androgen receptor modulator (SARM) for SUI.

 

Applied Genetic Technologies Corporation announced the presentation of new data from studies in animal models of achromatopsia (ACHM) and X-linked retinitis pigmentosa (XLRP) that support the company’s clinical development programs in these indications. The data were presented at the American Society of Gene and Cell Therapy 20(th) Annual Meeting, taking place in Washington, D.C., May 10-13.

 

uniQure presented data on successful repeated hepatic gene delivery with uniQure’s AAV5 vector following a proprietary immunoadsorption procedure in non-human primates (NHPs). The results describing successful sequential transduction with the two reporter transgenes were presented today in a session at the American Society of Gene and Cell Therapy (ASGCT) 20(th) Annual Meeting in Washington, D.C., and highlight the progress made in readministration protocols for AAV gene transfers.

 

LENSAR and PDL BioPharma announced the completion of LENSAR’s financial restructuring with a court-approved exit plan finalized on May 11, 2017.   As part of the plan, PDL will convert most of its debt to an equity ownership position. LENSAR will become a wholly-owned subsidiary of PDL, and PDL will begin to consolidate LENSAR’s financial statements.

 

Adamas Pharmaceuticals announced that it has entered into a $100 million royalty-backed note agreement with HealthCare Royalty Partners (HCR). Under the terms of the transaction, Adamas will receive $35 million at closing and an additional $65 million upon FDA approval and receipt of Orphan Drug exclusivity of ADS-5102 (amantadine) extended-release capsules for the treatment of levodopa-induced dyskinesia in people with Parkinson’s disease. Adamas will use the proceeds from the royalty-backed note agreement for general corporate purposes, including the commercialization of ADS-5102 for the treatment of levodopa-induced dyskinesia in people with Parkinson’s disease in the United States, for which a NDA is currently under review by the FDA with a PDUFA date of August 24, 2017. The proceeds will also be used to advance the company’s ongoing clinical development programs.

 

Merus Labs International and Norgine announced that they have entered into a definitive agreement (the "Arrangement Agreement") under which Norgine will acquire all of the issued and outstanding common shares of Merus for $1.65 per share in cash including the assumption of all debt obligations, for a total enterprise value of approximately $342 million (the "Arrangement"). The transaction will be financed through a combination of available cash and new credit facilities that Norgine has secured prior to executing the Arrangement. The transaction price of $1.65 per share represents a premium of 63.4% to the closing price of $1.01 on the TSX on May 10, 2017 and a premium of 55.1% over the 30-day volume weighted average price of $1.06 on the TSX.

 

AmpliPhi Biosciences announced the closing of its previously announced underwritten public offering. Total proceeds to AmpliPhi from the offering were approximately $9.1 million, after deducting the underwriting discount and commissions and estimated offering expenses payable by AmpliPhi, and excluding any proceeds that may be received upon exercise of the common warrants. AmpliPhi sold 7,067,419 shares of its common stock (or pre-funded warrants to purchase common stock in lieu thereof), including 110,897 shares of common stock sold pursuant to the partial exercise of the underwriter’s option to purchase additional shares, and common warrants to purchase 8,000,000 shares of common stock, including common warrants to purchase up to 1,043,478 shares of common stock sold pursuant to the full exercise of the underwriter’s option to purchase additional common warrants. AmpliPhi anticipates using the net proceeds from the offering for general corporate purposes, including manufacturing expenses, clinical trial expenses, research and development expenses and general and administrative expenses. Rodman & Renshaw, a unit of H.C. Wainwright & Co., acted as the sole book-running manager for the offering.

 

Dermira announced the pricing of its offering of $250,000,000 aggregate principal amount of 3.00% Convertible Senior Notes due 2022 in a private offering to qualified institutional buyers pursuant to the Securities Act of 1933, as amended. Dermira also granted the initial purchasers of the notes a 30-day over-allotment option to purchase up to an additional $37,500,000 aggregate principal amount of notes. The sale of the notes is expected to close on May 16, 2017, subject to customary closing conditions. Dermira intends to use the net proceeds that it receives from the note offering for working capital, capital expenditures and other general corporate purposes. Dermira may also use a portion of the net proceeds from this offering to expand its business by in-licensing or acquiring, as the case may be, product candidates, technologies, compounds, other assets, commercial products or complementary businesses; however, Dermira has no current commitments or obligations to do so.

 

Conatus Pharmaceuticals announced that it has priced an underwritten public offering of 5,200,000 shares of its common stock at a price to the public of $5.50 per share. Gross proceeds, before underwriting discounts and commissions and estimated offering costs, are expected to be approximately $28.6 million. Conatus intends to use approximately $16.7 million of the gross proceeds from the offering to fund pipeline expansion and for working capital and other general corporate purposes, and approximately $11.9 million of the gross proceeds to repurchase and retire 2,166,836 shares of common stock held by funds affiliated with Advent Private Equity at a price equal to the net proceeds per share that Conatus will receive from this offering, before expenses. Conatus has granted the underwriters a 30-day option to purchase up to 780,000 additional shares of its common stock. The offering is expected to close on or about May 16, 2017, subject to satisfaction of customary closing conditions. Stifel and SunTrust Robinson Humphrey are acting as book-running managers for the offering.

 

 

ANALYST RECOMMENDATIONS

 

Following Prothena’s earnings, Wedbush analyst David Nierengarten decreased his price target to $75 from $77.

 

Following Charles River Laboratories’ earnings, Evercore ISI analyst Ross Muken increased his price target to $101 from $99; Jefferies analyst David Windley decreased his price target to $104 from $106; Citi analyst Garen Sarafian increased his price target to $91 from $90; Barclays analyst Jack Meehan increased his price target to $90 from $84; Goldman Sachs analyst Robert Jones increased his price target to $86 from $85;Wells Fargo analyst Tim Evans increased his price target to $98 from $95. 

 

Following INC Research Holdings’ earnings, Baird analyst Eric Coldwell upgraded the company to “outperform” from “neutral” and increased his price target to $66 from $46; Jefferies analyst David Windley increased his price target to $62 from $51; Wells Fargo analyst Timothy Evans increased his price target to $55 from $45.

 

Morgan Stanley analyst Ricky Goldwasser downgraded Albany Molecular to “equal-weight” from “overweight,” citing a disappointing end to 2016 and the possibility that organic trends could slow again in 2Q17.

 

Citi analyst Yigal Nochomovitz decreased his price target of Ultragenyx to $45 from $56, citing a re-assessment of the fundamentals with a focus on lead drug and valuation driver burosumab for XLH.

 

Following Omeros’ earnings, Cantor Fitzgerald analyst Elemer Piros downgraded the company to “neutral” from “overweight” and decreased his price target to $15 from $21; Maxim analyst Jason Kolbert increased his price target to $23 from $22.

 

Following Nanthealth’s earnings, Canaccord analyst Richard Close decreased his price target to $8 from $10.

 

JP Morgan analyst Jessica Fye initiated coverage of Ascendis Pharma with an “overweight” rating and $36 price target, citing the TransCon platform enables a relatively de-risked approach to developing long-acting therapeutics and a high probability of Phase III success for lead asset TransCon growth hormone in pediatric growth hormone deficiency.