BioShares Biotechnology Clinical Trials (BBC): $20.23, -$0.25, +9.9% YTD

BioShares Biotechnology Products (BBP): $36.33, -$0.30, +10.9% YTD

 

 

MARKET COMMENTARY

 

U.S. stock index futures were little changed as investors assessed a raft of quarterly earnings, a day after the Dow and the Nasdaq hit record highs. European shares rose, gaining support from strong quarterly results of top companies and Asian equities ended higher. Concerns over France’s presidential election continued to weigh on the euro, pushing it lower against the dollar. Oil prices slid due to a big increase in U.S. crude inventories. Safe-haven demand helped gold edge up.

 

 

MARKET HIGHLIGHTS

 

Cellect Biotechnology has treated the first blood cancer patient in the recently initiated Phase I/II trial of its stem cell technology ApoGraft™.  The trial is intended to assess the Cellect ApoGraft™ process which is designed to prevent Graft-versus-Host Disease (GvHD), a common complication associated with stem cell transplant in which the transplanted immune cells attack the recipient’s body cells and organs. GvHD is a life-threatening condition occurring in up to 50% of stem cell transplants. In this trial, the company will be testing stem cells transplanted from a matched donor related to the patient.

 

Kamada announced the appointment of Gwen A. Melincoff to the Company’s Board of Directors.  Ms. Melincoff has over 25 years of leadership experience in the biotechnology and pharmaceutical industries. Her experience has spanned venture financing, business development, licensing, mergers and acquisitions, research operations, marketing, product management, project management, and public and private company boards.

 

OncoSec Medical Incorporated will present new clinical data on ImmunoPulse® IL-12, its lead program focused on oncology, at the upcoming 2017 American Association for Cancer Research & Society for Immunotherapy of Cancer (ASCO-SITC) Clinical Immuno-Oncology Symposium.  In addition, Punit Dhillon, President & CEO, will present a corporate overview at two investment conferences in February, including: the 19th Annual BIO CEO & Investor Conference on February 14th @ 3pmET, and Source Capital Group’s 2017 Disruptive Growth & Healthcare Conference on February 15th @ 3pmET.

 

Zealand Pharma reported royalty revenue from Sanofi`s sales of Lyxumia® (lixisenatide) outside the United States of DKK 5.3 million / €0.7 million for Q4 2016. Zealand`s annual royalty revenue in respect of Lyxumia® amounted to DKK 24.3 million / €3.3 million in 2016.  Lixisenatide is a once-daily prandial GLP-1 receptor agonist for the treatment of patients with type 2 diabetes and was invented by Zealand. Zealand licensed the global development and commercialization rights to lixisenatide to Sanofi. Lixisenatide is marketed under the brand name Lyxumia® in over 45 countries and was launched in the United States under the brand name Adlyxin™ in January 2017.

 

MediciNova announced that an abstract regarding MediciNova’s ongoing clinical trial of MN-166 (ibudilast) in ALS (amyotrophic lateral sclerosis) has been accepted for presentation at the American Academy of Neurology (AAN) 69th Annual Meeting to be held April 22-28, 2017 in Boston.

 

Mateon Therapeutics will present a company overview at the 19th Annual BIO CEO & Investor Conference on Monday, February 13th @ 5:30pm Eastern Time.

 

Foamix Pharmaceuticals will report its financial results for the year ended December 31, 2016 on Tuesday, February 21st after market close, and will host a corporate update conference call and webcast on Wednesday, February 22nd, at 8:30am Eastern Time.

 

Zogenix will present a corporate update at the Leerink Partners 6th Annual Global Healthcare Conference on February 15t @ 9:30am Eastern Time.

 

Alcobra will report its financial results for the year ended December 31, 2016 on Wednesday, February 15, at 8:30 am Eastern Time. The company also announced a corporate presentation at the BIO CEO & Investor Conference on Tuesday, February 14th @ 8:30am Eastern Time.

 

Ignyta will make a presentation at the LEERINK Partners 6th Annual Global Healthcare Conference on Wednesday, February 15th @ 11:30am Eastern Time.

 

After yesterday’s close, Gilead reported 4Q16 non-GAAP EPS of $2.70, which compares to $3.32 for the same period a year ago. The company beat the non-GAAP EPS mean estimate of $2.61. Total revenue for 4Q16 was $7.32 billion, which compares to $8.51 billion for the same period a year ago. This compares to a mean estimate of $7.15 billion. Following earnings, Goldman analyst Terence Flynn decreased his price target to $70 from $81; Leerink analyst Geoffrey Porges decreased his price target to $74 from $91; Barclays analyst Geoffrey Meacham decreased his price target to $90 from $105; Stifel analyst Katherine Breedis decreased her price target to $87 from $100; Citi analyst Robyn Kanauskas downgraded the stock to “neutral” from “buy” and decreased her price target to $76 from $87; JP Morgan analyst Cory Kasimov decreased his price target to $82 from $96; Baird analyst Brian Skorney decreased his price target to $87 from $100; RBC analyst Michael Yee decreased his price target to $75 from $90; Cowen analyst Phil Nadeau decreased his price target to $90 from $100; Jefferies analyst Brian Abrahams decreased his price target to $83 from $93; Morgan Stanley analyst Matthew Harrison decreased his price target to $77 from $85; Credit Suisse analyst Alethia Young decreased her price target to $79 from $93; Piper Jaffray analyst Joshua Schimmer decreased his price target to $95 from $102.

 

Reuters reported that GlaxoSmithKline sales and profits jumped in the fourth quarter, helped by falling sterling, but the drugmaker cautioned profit growth could be impacted in 2017 by generic competition to its top-selling lung drug Advair. Quarterly sales rose 21 percent in sterling terms to 7.59 billion pounds, generating core earnings per share (EPS) up 45 percent at 26.1 pence, GSK said. Analysts, on average, had forecast sales of 7.45 billion pounds and core EPS, which excludes certain items, of 25p, Thomson Reuters data shows. Core earnings per share, in constant currencies, are set to be flat to slightly lower in 2017, if there are substitutable generic copies of Advair in the United States by mid-year, as many analysts expect. If generics don’t arrive, core EPS should increase between 5 and 7 percent. January 2017 average exchange rates, if applied to whole of 2017, would benefit sterling core EPS by around 9 percent, the group added.

 

Reuters reported that Allergan reported quarterly earnings and revenue that topped Wall Street estimates, as higher demand for Botox and eye treatment Restasis helped offset declines in its older drugs, and the company forecast 2017 revenue above expectations. The company’s revenue rose 7 percent to $3.86 billion in the fourth-quarter ended Dec. 31, beating the average estimate of $3.77 billion, according to Thomson Reuters I/B/E/S. Net loss attributable to ordinary shareholders narrowed to $70.2 million, or 20 cents per share, in the fourth-quarter ended Dec. 31, from $700.5 million, or $1.78 per share, a year earlier. Excluding items, the company earned $3.90 per share, handily beating the average estimate by 14 cents. The Dublin-based company also forecast adjusted earnings in the range of $15.80 per share to $16.30 per share on revenue of $15.50 billion to $15.80 billion for 2017. Analysts on average were expecting a profit of $16.01 per share and revenue of $15.37 billion.

 

StreetAccount reported that according to the FDA’s Orphan Drug product website, Seattle Genetics has been granted Orphan drug designation for Adcetris for the treatment of cutaneous T-cell lymphoma.

 

Galectin Therapeutics and the Providence Cancer Center announced the presentation of preclinical and early clinical data from two investigator-initiated Phase I clinical trials of GR-MD-02 used in combination with approved cancer immunotherapies.

 

Pieris Pharmaceuticals announced that Darlene Deptula-Hicks has submitted her resignation, effective immediately, to pursue other interests. While the Company conducts an executive search for a permanent successor, Lance Thibault of Danforth Advisors, is assuming the role of Acting Chief Financial Officer. Pieris also announced the termination of its ATM Common Stock Sales Agreement, originally entered into on October 5, 2016 with Cowen and Company, LLC. The Company did not offer or sell any shares under the ATM program prior to its termination.

 

Amgen announced that the FDA has approved Parsabiv (etelcalcetide) for the treatment of secondary hyperparathyroidism (HPT) in adult patients with chronic kidney disease (CKD) on hemodialysis. Parsabiv is the first therapy approved for this condition in 12 years and the only calcimimetic that can be administered intravenously by the dialysis health care team three times a week at the end of the hemodialysis session.

 

Diffusion Pharmaceuticals announced that the data from the Phase I/II clinical trial evaluating the safety and efficacy of trans sodium crocetinate (TSC) in newly diagnosed glioblastoma multiforme (GBM) has been published in the print edition of the peer-reviewed Journal of Neurosurgery ("JNS") (Volume 126, February 2017). Results from the Phase I/II clinical trial in 59 patients showed that 36.3% of the full TSC dose patients were alive at two years, compared to historical two-year survival rates ranging from 27% to 30%. TSC, the Company’s lead product candidate, is designed to target the tumor’s reduced oxygen microenvironment. TSC re-oxygenates cancerous tissue, thus making the cancer cells more susceptible to current radiation therapy and chemotherapy.

 

Lexaria Bioscience, through its wholly owned Canadian subsidiary Lexaria Canpharm, has signed and entered a master collaborative research agreement with the National Research Council of Canada (NRC) to investigate technical aspects and new opportunities associated with bioavailability enhancement of lipophilic active ingredient compositions.

 

OPKO Health announced that its wholly owned subsidiary, OPKO Health Spain, has completed development of Enko 1, a patented intra-articular injectable hyaluronic acid and chondroitin sulfate complex to relieve pain and improve mobility in patients with degenerative and traumatic changes in the knee and other joints, as occurs in osteoarthritis. Enko 1 will be submitted for approval as a Class III medical device with the goal to market it throughout the European Union. The market for hyaluronic acid for this use is $2 billion globally; and $1 billion in Europe.

 

Portola Pharmaceuticals announced that the FDA’s Center for Drug Evaluation and Research (CDER) has informed the Company, as part of its mid-cycle review, that it does not plan to hold an Advisory Committee meeting for Portola’s NDA for betrixaban. Betrixaban is an oral, once-daily Factor Xa inhibitor anticoagulant. The NDA for betrixaban, an FDA Fast Track-designated therapy, is under priority review by the FDA for extended-duration prophylaxis of venous thromboembolism (VTE) in acute medically ill patients with risk factors for VTE.

 

Dr. Reddy’s Laboratories announced the expansion of its commercial operations in Europe with the introduction of its portfolio of generics in France. The first products will be made available in the hospital market in March 2017 in the area of oncology and anti-infectives, including antimycotics.

 

Spotlight Innovation announced that it has engaged a top-tier contract research organization (CRO) to conduct additional preclinical mouse studies of STL-182, the Company’s proprietary small molecule product candidate for the treatment of spinal muscular atrophy (SMA).

 

PTC Therapeutics announced the third annual STRIVE (Strategies to Realize Innovation, Vision and Empowerment) grant award program for Duchenne muscular dystrophy (DMD). STRIVE provides funds to patient advocacy organizations to develop unique and collaborative programs that will make meaningful contributions to the rare disease community by increasing awareness, diagnosis, education or fostering development of future patient advocates.

 

Arbutus Biopharma announced that the Supreme Court of British Columbia granted Arbutus’ request for a pre-trial injunction against Acuitas, preventing Acuitas from sublicensing Arbutus’ lipid nanoparticle (LNP) technology until the end of October, or further order of the Court.  Under the terms of the pre-trial injunction, Acuitas is prevented from entering into any new agreements which include sublicensing of Arbutus’ LNP.

 

The label for Eli Lilly’s once-weekly Trulicity (dulaglutide) is now updated to include use in combination with basal insulin for adults with type 2 diabetes. The FDA included the changes to the approved product labeling to reflect this important information for prescribers. Trulicity is available in a prefilled pen in 0.75 and 1.5 mg doses.

 

GSK Consumer Healthcare announced the nationwide launch of FLONASE Sensimist Allergy Relief (fluticasone furoate, 27.5 mcg spray), a new over-the-counter (OTC) treatment for symptoms associated with seasonal and perennial allergies.

 

Can-Fite BioPharma announced the Company is ready to commence patient enrollment in the second quarter of 2017 in its global Phase III trial of its lead drug candidate Piclidenoson as a first line treatment for rheumatoid arthritis. The trial, titled ACRobat, will enroll approximately 500 patients in Europe, Canada and Israel.

 

Supernus Pharmaceuticals announced the issuance on January 31, 2017 of an eighth patent (number 9,555,004) by the United States Patent and Trademark Office (USPTO) covering Trokendi XR, its novel once-daily extended-release topiramate product. The patent provides protection for the product with expiration that is no earlier than 2027.

 

Galena Biopharma announced the pricing of an underwritten public offering of units with anticipated gross proceeds of $17,000,000, before deducting underwriting discounts and commissions and estimated offering expenses payable by Galena. Each unit consists of one full share of its common stock and a warrant to purchase one share of its common stock and is priced at $1.00 per unit. The warrants are immediately exercisable at a price of $1.10 per share of common stock and will expire on the fifth anniversary of the date of issuance. The offering is expected to close on or about February 13, 2017, subject to customary closing conditions. Canaccord Genuity is acting as sole book-running manager for the offering.

 

Coherus BioSciences announced the pricing of its underwritten public offering of 5,154,640 shares of its common stock at a price to the public of $24.25 per share. All of the shares of the common stock to be sold in the offering will be offered by Coherus. In addition, Coherus has granted the underwriters a 30-day option to purchase up to an additional 773,196 shares of its common stock at the public offering price, less the underwriting discount, solely to cover over-allotments. Coherus intends to use the net proceeds from this offering for building the sales and marketing infrastructure for CHS-1701, inventory build, manufacturing and related activities to support the potential launch of CHS-1701, ongoing manufacturing and clinical trial activities for CHS-0214 and CHS-1420, and any remaining proceeds for working capital and other general corporate purposes. The offering is expected to close on or about February 13, 2017, subject to satisfaction of customary closing conditions. J.P. Morgan and Citigroup are acting as joint book-running managers for the offering. Cowen and BMO Capital Markets are acting as lead managers for the offering.

 

 

ANALYST RECOMMENDATIONS

 

Jefferies analyst Gena Wang initiated coverage of Loxo Oncology with a “buy” rating and $50 price target, citing pipeline assets from partner Array Biopharma provides LT growth potential.

 

Following Myriad Genetics’ earnings, Ladenburg Thalman analyst Kevin DeGeeter upgraded the stock to “neutral” from “sell,” and removed his price target; Avondale analyst Sung Ji Nam decreased his price target to $39 from $42; Piper Jaffray analyst William Quirk increased his price target to $22 from $21; JP Morgan analyst Tycho Peterson decreased his price target to $15 from $17.

 

Janney analyst Ken Trbovich decreased his price target of AMAG Pharmaceuticals to $20 from $25, citing Makena’s uncertain outlook.

 

Stifel analyst Annabel Samimy decreased her price target of Valeant to $45 from $50, citing VRX has announced several divestitures, accounting for over $500mn in sales, and has publicly stated that it believes it has a maximum of $800mn brand exposure to loss-of-exclusivity.

 

Following Mallinckrodt’s earnings, BMO analyst Gary Nachman decreased his price target to $79 from $81; Oppenheimer analyst Derek Archila decreased his price target to $70 from $72; Leerink analyst Jason Gerberry decreased his price target to $60 from $70.