BioShares Biotechnology Clinical Trials (BBC): $22.82, +$0.19, +24.0% YTD

BioShares Biotechnology Products (BBP): $38.29, +$0.25, +16.9% YTD

 

 

MARKET COMMENTARY

 

U.S. stock index futures were little changed ahead of the Federal Open Market Committee’s two-day meeting on interest rate policy. Investors will look forward to the language of the Fed statement for guidance on the number of interest rates hikes this year and next. Apple and Gilead Lifesciences are among few major companies scheduled to report quarterly results later in the day. European markets rose supported by strong corporate earnings and manufacturing data. Asian shares closed mostly higher. The dollar hit a one-month high against the yen, lifted by a surge in U.S. government bond yields after Treasury Secretary Steven Mnuchin commented on the possibility of ultra long-term bond issuance. Gold was little changed. Oil prices rose on expectations that major OPEC exporters would extend output cuts into the second half of the year.

 

 

MARKET HIGHLIGHTS

 

Foamix Pharmaceuticals announced results from additional analysis of the recently completed Phase 3 pivotal trials for its lead candidate FMX101 in moderate to severe acne.  Based on the knowledge gained from the results of the first two pivotal trials (Trials 04 and 05), the company intends to conduct a third U.S. Phase 3 Trial, beginning mid-year, in patients with moderate to severe acne.  In order to achieve the necessary statistical power, compared with the prior Phase 3 trials, the target patient enrollment number has been increased to 1,500. Patients will be randomized 1:1 to receive either FMX101 (minocycline foam 4%) or vehicle foam once daily over 12 weeks. The co-primary efficacy endpoints will be identical to the prior Phase 3 trials: 1) mean change from baseline in the inflammatory lesion count, and 2) proportion of patients with IGA scores of "Clear" or "Almost Clear", with improvement of at least two grades from baseline. The inclusion criteria will be consistent with the prior Phase 3 trials. The trial is planned to be conducted at approximately 80 clinical sites in the U.S.  If the results are positive, this trial is expected to form the basis for a New Drug Application (NDA) which the company plans to submit in the second half of 2018.

 

Ignyta announced financial results for the first quarter ended March 31, 2017. For the first quarter of 2017, net loss was $40.2 million, or $0.96 per share, compared with $25.5 million, or $0.79 per share, for the first quarter of 2016.  At March 31, 2017, the company had cash, cash equivalents and available-for-sale securities totaling $108.0 million and current and long-term debt of $32.0 million. At December 31, 2016, the company had cash, cash equivalents and available-for-sale securities totaling $133.0 million and current and long-term debt of $32.0 million. Excluding a $3.0 million milestone payment related to the Lilly license, cash burn in the quarter was $22.0 million.

 

BioDelivery Sciences International announced that the U.S. Food and Drug Administration has approved a Supplemental New Drug Application for BUNAVAIL® (buprenorphine and naloxone) buccal film (CIII) revising the indication to include the use of BUNAVAIL for the initiation of buprenorphine treatment for opioid dependence.

 

Santhera Pharmaceuticals announced that it has signed an agreement with Pharmathen to market Raxone® for the treatment of Leber’s hereditary optic neuropathy (LHON) in Greece and Cyprus. LHON is a rare, heritable, mitochondrial disease that leads to rapid, profound and usually permanent blindness in otherwise healthy patients. Raxone is the first treatment option for LHON and the first approved therapy for a mitochondrial disease.

 

ABIVAX announced today that the company’s lead therapeutic candidate ABX464 demonstrated the first reduction in HIV reservoirs ever observed in chronically infected HIV patients as measured by total HIV DNA detected in peripheral blood mononuclear cells (PBMCs).  In the ABX464-004 trial, 30 HIV patients were enrolled in Spain, Belgium and France. Patients were enrolled in a 3:1 randomization, receiving either ABX464 or matching placebo in addition to their current antiretroviral treatment during 28 days. The viral load at the start of the study was well controlled with boosted darunavir. After the 28-day treatment period, all treatments were interrupted until viral load rebound.  Baseline and day 28 blood samples were taken in order to assess the potential effect of ABX464 on the HIV reservoir in PBMCs.  The clinical trial has been completed with respect to patient treatment and follow-up.

 

OncoSec Medical Incorporated announced today that Robert H. Pierce, MD, OncoSec Chief Scientific Strategist, will speak at the Biomarkers & Immuno-Oncology World Congress, taking place May 2-4, 2017, in Philadelphia, PA.

 

VBI Vaccines provided an update on its cytomegalovirus ("CMV") Phase I clinical study, which is assessing the safety and tolerability of VBI’s vaccine candidate to prevent congenital CMV infection. Congenital CMV infection is a leading cause of birth defects, affecting more live births than Down syndrome or fetal alcohol syndrome, making it a key public health priority.  Upon review of all safety data up to one month after second immunizations in VBI’s prophylactic CMV Phase I clinical study, the Data and Safety Monitoring Board unanimously recommended the continuation of the study without modification. No safety signals have been detected, suggesting VBI’s CMV vaccine candidate is safe and well-tolerated.  Additionally, all participants in the study have now successfully received the third and final immunization in the series. Further vaccine immunogenicity and safety follow-up are ongoing.  An interim safety and immunogenicity report, based on blood samples collected from participants one month post-second vaccination, is expected mid-year 2017.

 

Arena Pharmaceuticals will release its first quarter 2017 financial results and provide a corporate update on Tuesday, May 9, 2017, after the close of the U.S. financial markets. 

 

Oramed Pharmaceuticals announced that based on positive preclinical data, the Company is developing a new drug candidate, a weight loss treatment in the form of an oral leptin capsule. Leptin, also known as the "obesity hormone" is a protein that regulates hunger.

 

After yesterday’s close, Exelixis reported 1Q17 GAAP EPS of $0.05, which compares to a loss of $0.26 for the same period a year ago. The company beat the GAAP EPS mean estimate loss of $0.01. Total revenue for 1Q17 was $80.9 million, which compares to $15.4 million for the same period a year ago. This compares to an estimate of $65.2 million. Following the earnings, Leerink analyst Michael Schmidt increased his price target to $27 from $26; Stifel analyst Stephen Willey increased his price target to $24 from $22.

 

Bio-Techne reported fiscal 3Q17 non-GAAP EPS of $0.97, which compares to $1.01 for the same period a year ago. The company beat the non-GAAP EPS mean estimate of $0.93. Total revenue for fiscal 3Q17 was $144.0 million, which compares to $131.0 million for the same period a year ago. This compares to a mean estimate of $142.7 million.

 

Tonix Pharmaceuticals announced the issuance of U.S. Patent No. 9,636,408 (‘408 patent) by the U.S. Patent and Trademark Office. The patent, “Eutectic Formulations of Cyclobenzaprine Hydrochloride and Amitriptyline Hydrochloride,” claims the composition and manufacture of a unique formulation that characterizes TNX-102 SL. The ‘408 patent is expected to provide Tonix with U.S. market exclusivity until 2034.

 

Sunesis Pharmaceuticals announced that the Company will withdraw its European MAA for vosaroxin as a treatment for relapsed/refractory acute myeloid leukemia (AML) in patients aged 60 years and older. The decision follows recent interactions with the EMA’s CHMP, during which the Company learned that the committee was likely to formally adopt a negative opinion in its evaluation of the application.

 

Celyad announced a non-exclusive license agreement with Novartis for Celyad’s U.S patents for the production of allogeneic CAR-T cells. This license agreement is related to two targets currently under development by Novartis. The agreement includes Celyad’s intellectual property rights under U.S Patent No. 9,181,527 related to allogeneic human primary T-Cells that are engineered to be T-Cell Receptor (TCR) deficient and express a Chimeric Antigen Receptor (CAR). The granted claims are not limited to specific CARs or specific methods of generating allogeneic CAR T- cells, such as genome editing or genetic engineering. Under the terms of the agreement Celyad receives an upfront payment and is eligible to receive success based clinical, regulatory and commercial milestone payments. If all success based milestones are achieved, Celyad is eligible to receive payments, including the upfront payment, totalling $96 million. In addition, Celyad will receive single digit royalties based on net sales of the licensed target associated products. Novartis has the option to extend the agreement to additional targets and/or to convert its license into an exclusive license. Celyad retains all rights to grant further licenses to third parties for the use of allogeneic CAR-T cells. Celyad will not be involved in the development of Novartis’ CAR-T cells. Celyad will continue to focus on the development of its CAR-T pipeline, including its allogeneic NKR-2 T-cell immunotherapy in the EU and US territories and in collaboration with Ono Pharmaceuticals, its partner in Japan, Taiwan and Korea.

 

Otsuka Pharmaceutical Co., and H. Lundbeck A/S  announced top-line results from two phase III clinical trials evaluating the efficacy, safety and tolerability of brexpiprazole in the treatment of agitation in patients with dementia of the Alzheimer’s type.

 

Braeburn Pharmaceuticals and Camurus announced positive top-line results from a long-term Phase III trial supporting the safety and efficacy of CAM2038 (weekly and monthly buprenorphine depots) in patients with moderate-to-severe opioid use disorder.

 

Orexigen Therapeutics announced that its wholly owned subsidiary, Orexigen Therapeutics Ireland Ltd., and Navamedic AB, an affiliate of Navamedic ASA, have executed a distributorship agreement covering Denmark, Finland, Iceland, Norway and Sweden for Mysimba (naltrexone HCl / bupropion HCl prolonged release).  Navamedic ASA manufactures and markets pharmaceutical products and medical technology to patients, hospitals and pharmacies in the Nordic, Benelux and Baltic markets.

 

Concert Pharmaceuticals announced the initiation of a Phase IIa clinical trial evaluating CTP-543 for the treatment of moderate-to-severe alopecia areata, an autoimmune disorder in which the immune system attacks hair follicles, resulting in patchy or complete hair loss. CTP-543 is an orally-administered selective inhibitor of Janus kinases 1 and 2, known as JAK1 and JAK2, which are enzymes believed to be involved in this autoimmune disorder. The Phase IIa trial is designed to evaluate the safety and efficacy of CTP-543 after 12 months of dosing with the primary efficacy analysis at week 24. The Company expects to report topline data in the first quarter 2018.

 

Magenta Therapeutics announced rapid progress in advancing the company’s strategic vision, including the completion of a $50 million Series B financing; in-licensing a clinical-stage program from Novartis to support the use of stem cell transplantation in a variety of disease settings; and a strategic partnership with Be The Match BioTherapies, an organization offering solutions for delivering autologous and allogeneic cellular therapies.

 

PLx Pharma announced the appointment of Rita M. O’Connor as Chief Financial Officer (CFO), effective July 1, 2017. Ms. O’Connor succeeds David Jorden, who has served as the Company’s Acting CFO since June 2015 and previously served as a PLx board member since 2005. Mr. Jorden will transition at the end of July.

 

ZIOPHARM Oncology announced that an investigator-initiated IND application to the FDA for a Phase I trial infusing the Company’s CD33-specific CAR(+) T therapy for relapsed or refractory acute myeloid leukemia (AML) is now active, with the first patient to be enrolled in the study expected to begin treatment in the third quarter of 2017. The CD33-specific CAR(+) T cells incorporate a kill switch designed to eliminate the modified T cells under potential adverse safety conditions.

 

Amicus Therapeutics has commenced the commercial launch of the precision medicine Galafold in France following the publication of the price in the Official Journal. Galafold is now reimbursed in France and dispensed via retail pharmacists as a therapy for long-term treatment of adults and adolescents aged 16 years and older with a confirmed diagnosis of Fabry disease (alpha-galactosidase A deficiency) and who have an amenable mutation.

 

Accuray announced preliminary results from a prospective, phase I clinical trial evaluating adjuvant stereotactic partial breast irradiation (S-PBI) in early stage breast cancer patients treated with the CyberKnife System. The study, published in the May issue of the peer-reviewed International Journal of Radiation Oncology – Biology – Physics, reported no recurrences or distant metastases at median follow-up of 26 months. Additionally, at two years, more than 95 percent of patients and 100 percent of physicians rated cosmesis as excellent or good, indicating both patients and physicians were satisfied with the appearance of the breast (cosmesis) following treatment.

 

bluebird bio announced that it has entered into a worldwide license agreement around its proprietary lentiviral vector platform with GlaxoSmithKline Intellectual Property Development Limited.

 

Selecta Biosciences announced that it has licensed LMB-100, a next-generation immunotoxin, from the Center for Cancer Research (CCR) at the NCI, part of the National Institutes of Health. LMB-100 contains a potent bacterial toxin that binds to mesothelin, a protein expressed in all mesotheliomas, pancreatic adenocarcinomas and a high percentage of other malignancies, including lung, breast and ovarian cancers.

 

Abeona Therapeutics announced updated clinical data from the ongoing Phase I/II clinical trial for the EB-101 gene therapy program for patients with Recessive Dystrophic Epidermolysis Bullosa (RDEB), a severe form of epidermolysis bullosa (EB), along with supportive natural history data for 128 patients with the fatal skin disease. These data were presented at the recently held Society for Investigative Dermatology (SID) conference by Abeona’s scientific and clinical collaborators at Stanford University School of Medicine, a center of excellence for the treatment of patients with epidermolysis bullosa.

 

Imprimis Pharmaceuticals and SightLife Surgical announced the signing of an exclusive strategic sales and marketing agreement. Under the agreement, SightLife Surgical will deploy their sales team to offer Imprimis’ Serum Tears compounded formulations to physicians, large practice groups, surgery centers, hospitals and healthcare organizations nationwide. Imprimis’ Serum Tears autologous serum eye drops (ASEDs) are prescribed for chronic dry eye patients who do not respond to traditional dry eye treatments.

 

Corvus Pharmaceuticals announced that it has expanded its clinical collaboration withGenentech, a member of the Roche Group. Under the new agreement, CPI-444 administered in combination with  atezolizumab (Tecentriq) will be evaluated in a Phase Ib/II clinical study as second-line therapy in patients with non-small cell lung cancer (NSCLC) who are resistant/refractory to prior therapy with an anti-PD(L)-1 antibody. The study will be part of MORPHEUS, Genentech’s novel cancer immunotherapy platform established to develop immunotherapy combination therapies more rapidly and efficiently. It is anticipated that this randomized, controlled study will enroll up to 65 patients in the treatment arm.

 

 

ANALYST RECOMMENDATIONS

 

Chardan analyst Madhu Kumar initiated coverage of Spring Bank Pharmaceuticals with a “buy” rating and $16.50 price target, citing Spring Bank is an immune therapy company with a phase IIa drug, SB 9200, for chronic hepatitis B virus (HBV) and a preclinical STING agonist, SB 11285, for solid cancers.

 

Janney analyst Debjit Chattopadhyay initiated coverage of Global Therapeutics with a “buy” rating and $37 price target, citing GBT is conducting the HOPE study (registrational) of GBT440, a once-daily, disease modifying investigational therapy for sickle cell disease.

 

Following Intra-Cellular’s corporate update on lumateperone based on the FDA feedback, Leerink analyst Seamus Fernandez downgraded the stock to “market perform” from “outperform” and decreased his price target to $10 from $29;Ladenburg Thalmann analyst Christopher James downgraded to “neutral” from “buy.”

 

Cowen analyst Chris Shibutani downgraded Radius Health to “market perform” from “outperform,” citing fewer near term drivers of outperformance.

 

Following Lion Biotechnologies’ earnings, FBR analyst Ed White decreased his price target to $16 from $17.

 

Jefferies analyst Peter Welford increased his price target of Galapagos to €110 from €80, citing the current share is a compelling entry point given filgotinib blockbuster potential and CF optionality.