BioShares Biotechnology Clinical Trials (BBC): $20.36, +$0.19, -29.9% YTD

BioShares Biotechnology Products (BBP): $30.54, -$0.05, -0.9% YTD

 

 

MARKET COMMENTARY

 

U.S. stock index futures traded flat ahead of economic data releases, including ADP national employment, Chicago PMI, and pending home sales index which occupy the day’s economic calendar. Salesforce.com
is scheduled to report after the closing bell. Asian shares eased, while the Nikkei rose, boosted by a weaker yen. European markets were mostly higher. The dollar and gold were near-flat to reflect uncertainty in the market. Crude oil futures continued to
slip after ending down for a second straight day on oversupply concerns.

 

 

MARKET HIGHLIGHTS

 

Ignyta announced that the U.S. Food and Drug Administration has approved an investigational device exemption (IDE) for its RNA-based companion diagnostic, next-generation sequencing assay (Trailblaze
Pharos™). The Trailblaze Pharos assay is intended for use in identifying patients, including those who are treatment-naïve, who have solid tumors with NTRK1/2/3, ROS1, or ALK gene rearrangements leading to fusion proteins, to determine eligibility for enrollment
into the global STARTRK-2 trial, a Phase 2 study of entrectinib, a novel, orally available, CNS-penetrant tyrosine kinase inhibitor targeting tumors that harbor NTRK1/2/3 (encoding TrkA/TrkB/TrkC), ROS1, or ALK gene fusions.

 

Valneva SE reported its consolidated financial results for the first half ended June 30, 2016.  Total revenues and grants grew to
51.4 million in H1 2016 vs 39.2 million in H1 2015.  EBITDA improved to
4.7 million in H1 2016, vs a 5.3 million EBITDA loss in H1 2015.  Liquid funds stood at
38.7 million on June 30, 2016 compared to 43.7 million on June 30, 2015 and consisted of
34.0 million in cash and cash equivalents, 4.0 million in short-term bank deposits and
0.6 million in restricted cash.

 

Onconova Therapeutics
communicated to certain employees its plan of termination to reduce a number of positions effective as of August 30, 2016, as part of its ongoing commitment to reduce costs. The Company estimates the net reduction to be approximately 6 employees, which
represents approximately 21 percent of its workforce. Affected employees are being offered severance pay in accordance with Company policy or, if applicable, their employment agreements. As a result of the workforce reduction, the Company estimates that it
will have an annual net savings of approximately $1.4 million and record in the third quarter of 2016 a one-time severance-related charge totaling approximately $.4 million. The severance-related charge that the Company expects to incur in connection with
the workforce reduction is subject to a number of assumptions, and actual results may differ materially. The Company may also incur other charges or cash expenditures not currently contemplated due to events that may occur as a result of, or associated with,
the workforce reduction.

 

Amarin announced that randomization of patients into the REDUCE-IT cardiovascular outcomes study has been completed with 8,175 individual patients randomized, in accordance with the study protocol,
on a 1:1 basis between Vascepa (icosapent ethyl) and placebo, slightly exceeding the 8,000 patients targeted for the trial.

 

Clovis Oncology entered into the First Amendment to License Agreement, between Clovis and
Pfizer. The First Amendment amends the existing License Agreement, between Clovis and Pfizer, dated June 2, 2011, to permit Clovis to defer payment of the milestone payments payable upon (i) FDA approval of an NDA for 1st Indication in US and (ii) EMA
approval of an MAA for 1st Indication in EU, to a date that is 18 months after the date of achievement of such milestones. In the event that Clovis defers such milestone payments, Clovis has agreed to certain higher payments related to the achievement of such
milestones.

 

Pfizer announced that the European Commission has approved XALKORI (crizotinib) for the treatment of adults with ROS1-positive advanced NSCLC. In the EU, XALKORI is also indicated for treatment
of adults with anaplastic lymphoma kinase (ALK)-positive advanced NSCLC. In March of this year, XALKORI was approved by the FDA for patients with metastatic NSCLC whose tumors are ROS1-positive. With this approval, XALKORI becomes the only biomarker-driven
therapy approved for patients with either ALK positive or ROS1-positive advanced NSCLC in the EU and U.S.

 

Takeda Pharmaceutical Company Limited announced that its global non-interventional, observational multiple myeloma study is now enrolling patients. Titled INSIGHT-MM, the study aims to enroll
5,000 patients over three years with a goal of following each patient for a minimum of five years in an effort to track patterns in disease presentation, patient characteristics, treatment and outcomes and thereby enhance the understanding of real world experience
of patients with multiple myeloma.

 

Laboratorios SALVAT S.A. and
Arbor Pharmaceuticals announced the launch of OTOVEL (ciprofloxacin 0.3 % and fluocinolone acetonide 0.025 %) otic solution, the first and only antibiotic and steroid combination ear drop available in single, sterile, preservative-free, unit-dose packaging. 
OTOVEL is owned by Salvat and Arbor will be the exclusive distributor of the product in the U.S.

 

Heart Metabolics announced it has initiated dosing in patients for an open-label Phase IIb study of perhexiline in patients with HCM and moderate-to-severe heart failure with preserved left ventricular
function. In a previously completed randomized, placebo-controlled, Phase IIa study, statistically significant improvements in exercise capacity, energetics and quality of life were observed.

 

Genmab A/S announced that the FDA has approved a sBLA for the use of ofatumumab (Arzerra(r)) in combination with fludarabine and cyclophosphamide (FC) for the treatment of patients with relapsed
chronic lymphocytic leukemia (CLL). The application, which received Priority Review in May 2016, was submitted to the FDA by Novartis under the ofatumumab collaboration between Novartis and Genmab.

 

RedHill Biopharma announced that it has received from the European Patent Office a Notice of Intention to Grant for a new patent covering the use of RHB-104 in the treatment of multiple sclerosis
(MS). Upon grant by the European Patent Office, the patent can be officially validated in up to 38 European countries.

 

Atossa Genetics announced the pricing of an underwritten public offering of 1,150,000 shares of its common stock at a price to the public of $2.50 per share. The gross proceeds to Atossa Genetics,
Inc., from this offering are expected to be approximately $2,875,000, before deducting underwriting discounts and commissions and other estimated offering expenses. Atossa Genetics, Inc. has granted the underwriters a 45-day option to purchase up to an additional
172,500 shares of common stock to cover over-allotments, if any. The offering is expected to close on September 6, 2016, subject to customary closing conditions.

 

Asterias Biotherapeutics announced that its Data Monitoring Committee (DMC) has reviewed the safety data from the initial cohort of three patients dosed with 2 million cells, and a subsequent
five patients in the second cohort dosed with 10 million cells, and has cleared the company to now begin dosing a third cohort of 5-8 complete cervical injury patients (AIS-A patients) with the highest dose of 20 million cells.  Concurrently, the study is
also proceeding with enrolling the first cohort of 5-8 sensory incomplete cervical spinal cord injury patients (AIS-B patients), each of whom will be administered 10 million cells.

 

Relypsa announced that the Phase IV TOURMALINE study, which compared the efficacy and safety of Veltassa (patiromer) for oral suspension given with or without food for the treatment of hyperkalemia,
met its primary endpoint. Results showed no statistically significant difference in the percent of patients achieving either week 3 or week 4 serum potassium in the target range (3.8 – 5.0 mEq/L) between the group taking Veltassa with food and that taking
it without. Adverse events with Veltassa in this study were consistent with previous clinical trials. Data from the TOURMALINE study will be submitted for presentation at a future medical meeting and shared with the FDA.

 

Sandoz, a Novartis division and the global leader in biosimilars, announced that the FDA approved Erelzi (etanercept-szzs) for all indications included in the reference product label,
including rheumatoid arthritis (RA), plaque psoriasis (PsO), psoriatic arthritis (PsA), ankylosing spondylitis (AS) and polyarticular juvenile idiopathic arthritis (JIA). Erelzi is the second biosimilar from Sandoz approved in the U.S through the FDA biosimilars
pathway established under the Biologics Price Competition and Innovation Act.

 

The Medicines Company provided an update on its clinical dyslipidemia research programs for MDCO-216 (which contains APoA-1 Milano) and PCSK9si (PCSK9 synthesis inhibitor). MDCO-216. A planned,
interim analysis of the first 40 randomized patients completing treatment in the MILANO-PILOT study of MDCO-216 has been reviewed by the Independent Data Monitoring Committee (IDM Committee). Based on the protocol and pre-defined criteria in its Charter, the
IDM Committee has reported the 40-patient data to the Company in summary form and recommended that the MILANO-PILOT study continue. The pre-defined, upper statistical boundary for efficacy, which permits early termination of the study by the Company, was not
met and, given the limited number of patients included in the first interim analysis, the summary data received by the Company from the IDM Committee are, at this time, inconclusive.

 

Allergan announced that its subsidiaries
Forest Laboratories, Forest Laboratories Holdings and Allergan USA, along with
Adamas Pharmaceuticals, have entered into a settlement agreement with Amneal Pharmaceuticals and
Amneal Pharmaceuticals of New York.

 

Reuters reported that U.S. regulators said that
AstraZeneca will pay $5.52 million to resolve a foreign bribery probe into improper payments by its sales and marketing staff to state-employed healthcare officials in China and Russia. The U.S. SEC detailed the settlement with the London-based drug
company in an order instituting an administrative proceeding arising out of violations of provisions in the Foreign Corrupt Practices Act.     AstraZeneca, which cooperated with the probe, neither admitted nor denied wrongdoing. In a statement, it said the
U.S. DOJ has meanwhile closed a related foreign bribery investigation.

 

Provectus Biopharmaceuticals announced that it has completed its public offering of 240,000 shares of Series B Convertible Preferred Stock and warrants to purchase 24,000,000 shares of common
stock at a price to the public of $25.00 for a combination of one share of Series B Convertible Preferred Stock and 100 warrants to purchase one share of common stock each. The warrants have an exercise price of $0.275 per share, are exercisable immediately
and will expire on August 30, 2021.  Maxim Group acted as placement agent for the offering. Provectus intends to use the net proceeds of the offering for clinical development, working capital and general corporate purposes.

 

Hemispherx Biopharma announced that it has entered into definitive agreements with two healthcare focused institutional investors for an offering of shares of common stock with gross proceeds
of approximately $5 million in a registered direct offering. The closing of the offering is expected to take place on or about September 6, 2016, subject to the satisfaction of customary closing conditions. In connection with the offering, the Company will
issue registered shares of common stock at a purchase price of $1.50 per share. Concurrently in a private placement, for each share of common stock purchased by an investor, such investor will receive from the Company an unregistered warrant to purchase 0.75
shares of common stock. The warrants have an exercise price of $2.00 per share, will be exercisable six months after issuance and will expire five years from the initial exercise date.
Rodman & Renshaw, a unit of H.C. Wainwright & Co., acted as the exclusive placement agent in connection with this offering.

 

The board of directors of
Eli Lilly has elected Jamere Jackson as a new member, effective October 1, 2016. As a member of Lilly’s board, he will serve on the Audit and Finance committees.

 

Oasmia Pharmaceutical announced the appointment of Fredrik Gynnerstedt to the position of CFO.

 

 

ANALYST RECOMMENDATIONS

 

Jefferies analyst Brian Abrahams decreased his price target of
Gilead to $91 from $93, citing Harvoni is tracking modestly light for 3Q.

 

BTIG analyst Dane Leone initiated the following the companies:
Kite with a “neutral” rating; Juno with a “sell” rating and $23 price target.

 

HC Wainwright analyst Shaunak Deepak increased his price target of
Rigel Pharmaceuticals to $7 from $6, citing positive topline data from the first Phase 3 trial for its Syk inhibitor fostamatinib in idiopathic thrombocytopenic purpura, a bleeding disorder characterized by low platelet counts.

 

Mizuho analyst Ann Hayes downgraded
Quest Diagnostics to “neutral” from “buy” and increased her price target to $86 from $84, citing solid outperformance.

 

Deutsche Bank
analyst Gregg Gilbert decreased his price target of Mallinckrodt to $84 from $87, citing the company’s move to a calendar fiscal year-end, and the planned divestiture of its Nuclear Imaging business to IBA Molecular.