Revisiting A Few Hot Biotech Stocks Of 2009
(RTTNews) - The biotechnology sector is a risky investment arena, but investing in such stocks can also be highly rewarding and exciting. A few biotech stocks - DNDN, TRGT, HGSI, VNDA and PLX - covered by our site have returned triple-digit percentage gains to date.
Let's take a look at the upcoming catalysts of the above-mentioned stocks, which have endured wild swings.
Dendreon Corp. (DNDN | Quote | Chart | News | PowerRating) has been a regular topic at RTTNews.com. The stock was trading around $6 when it was featured on our site in 2007 and around $5 in 2008 . The stock now trades around $28.
Dendreon is a classic example of a company with a steely determination to bring its drug to market, despite hurdles and challenges. Following its success in a pivotal late-stage study of Provenge dubbed IMPACT in April of this year, the company filed its amended application with the FDA seeking approval of Provenge on November 2, ahead of its schedule of mid-November.
Provenge, an investigational vaccine for the treatment of prostate cancer, works by stimulating the immune system to recognize a protein known as the prostatic acid phosphatase or PAP, which is found in about 95% of all prostate cancer cells and mounts an attack on the cancer cells.
This is Provenge's second go-around with the FDA. Dendreon filed for approval of Provenge in 2007 and an FDA Advisory Committee voted 17-0 in favor of the prostate cancer vaccine's safety and 13-4 that it demonstrated "substantial efficacy." That the FDA did not approve Provenge despite the advisory panel's favorable votes and requested more data is now part of the Dendreon story.
With the company now having successfully re-filed its application for Provenge, the FDA is expected to announce its decision on May 1, 2010. Assuming Provenge is launched by mid-2010, the company expects the vaccine to be manufactured at its New Jersey facility to garner sales of $60 million to $125 million in the first six months after launch. The New Jersey facility will initially operate at 25% capacity and is anticipated to reach its full capacity in the first half of 2011. When the new manufacturing plants in Atlanta and Los Angeles reach their full production capacity by the end of 2011, the potential annual sales of Provenge are estimated to be $1.2 billion to $2.5 billion.
When biopharmaceutical company Targacept Inc. (TRGT | Quote | Chart | News | PowerRating) reported positive top-line results from a mid-stage study of its investigational drug TC-5214 as an add-on therapy with citalopram for major depressive disorder on July 15 , little did anyone realize that the stock would have a rapid rise from $3 to where it is now - over $23.
The detailed results of the mid-stage study presented in October revealed that the add-on TC-5214 arm had a six-point advantage in the HAM-D ratings scale compared to the add-on placebo arm, which is of high statistical significance.
According to analysts, the efficacy and safety profile of TC-5214 looks much better than Bristol-Myers Squibb Co.'s (BMY | Quote | Chart | News | PowerRating) marketed depression drug Abilify. The sales of Abilify, which was originally approved for schizophrenia in adults in November 2002, have been on the rise since the drug's approval for the expanded indication of major depression as an add-on treatment. For the third-quarter ended September 30, 2009 global sales of Abilify totaled $653 million, reflecting an increase of 16% over the year-ago quarter.
On a recent conference call, Targacept's President and CEO, Don deBethizy said that the company is in talks to identify a strategic partner to help in the global development and commercialization of TC-5214. The investigational drug is expected to advance to phase III development in the second quarter of 2010.
Targacept's other product candidates include AZD3480 (TC-1734) for ADHD, which has completed a phase II study successfully; AZD1446 (TC-6683), a product candidate for Alzheimer's disease that has completed initial phase I single and multiple raising dose clinical trials and advanced to a phase I safety and tolerability study in healthy elderly volunteers; and TC-5619, a product candidate for cognitive dysfunction in schizophrenia that is expected to enter a phase II clinical proof of concept trial shortly. The company also has a pre-clinical product candidate for depression and anxiety disorders, TC-5685.
AZD3480 (TC-1734) for ADHD and AZD1446 (TC-6683) are being developed in collaboration with AstraZeneca plc (AZN | Quote | Chart | News | PowerRating). Targacept also has a strategic alliance with GlaxoSmithKline plc (GSK | Quote | Chart | News | PowerRating) for its pre-clinical programs focused in therapeutic areas namely, smoking cessation, obesity, pain, addiction and Parkinson's disease.
Human Genome Science Inc. (HGSI | Quote | Chart | News | PowerRating) is yet another hot biotech stock of the year, whose value has soared more than ten-fold since July, thanks to success of the company's lupus drug Benlysta in late-stage trials. The stock was trading around $2.25 when an article on Benlysta was featured on our site in May and today the stock trades around $28.
Lupus is a tough disease and the market for lupus drugs is even tougher, given the string of failures. Genelabs Technologies' Prestara, Aspreva's CellCept, La Jolla Pharmaceutical Co.'s (LJPC | Quote | Chart | News | PowerRating) Riquent and Biogen Idec Inc.'s (BIIB | Quote | Chart | News | PowerRating) cancer drug Rituxan have all met with disappointment in lupus studies. But Human Genome's Benlysta stands as an exception.
Having successfully cleared two phase III trials, Benlysta represents new hope for lupus patients. It has been over 50 years since the FDA approved a drug for lupus.
Benlysta, formerly known as LymphoStat-B, is being developed by Human Genome Sciences and GlaxoSmithKline under a co-development and commercialization agreement signed in August 2006. The companies plan to submit marketing applications for Benlysta in the first half of 2010 in the U.S., Europe and other regions. According to Piper Jaffray analyst Edward Tenthoff, Benlysta sales could reach $6 billion by 2016.
However, not everything has been smooth along the way for Human Genome. The company's anthrax treatment Raxibacumab, formerly called ABThrax, failed to win FDA approval as the regulators sought more information last month in order for the drug to be approved. The company is planning to address the questions raised by the FDA related to Raxibacumab.
Human Genome also has another investigational drug that has successfully completed two late-stage trials, Zalbin for chronic hepatitis C. Zalbin, formerly called Albuferon, is being developed in partnership with Novartis AG (NVS | Quote | Chart | News | PowerRating). In both the phase III trials, it has been proved that with half as many injections, Zalbin met its primary efficacy endpoint by achieving a rate of sustained virologic response comparable to Swiss drug giant Roche's Pegasys, which is the market leader worldwide in hepatitis C therapy. Pegasys generates annual sales of over $1.6 billion for Roche. Human Genome is expected to submit an application seeking regulatory approval to market Zalbin later this quarter.
The turnaround story of Vanda Pharmaceuticals Inc. (VNDA | Quote | Chart | News | PowerRating) has all the ingredients of a good thriller. Once written-off for dead, the stock has made a remarkable comeback following FDA approval of its antipsychotic drug Fanapt, also known as Iloperidone.
Vanda was founded in 2003 by Mihael Polymeropoulos, an executive who ran the Novartis global Pharmacogenetics department. The company went public in April 2006 at $10 a share. After a negative ruling from the FDA on Fanapt last July and the stock price plummeting to $0.90, Vanda faced pressure from its shareholders to liquidate the company. Vanda was trading around $0.83 when an article highlighting the impending FDA decision and shareholder activism was featured on our site in March of this year.
Fanapt is Vanda's first-ever product to be approved. The FDA approval of Fanapt on May 7 sent the stock soaring to $7.84, an increase of 625% from the previous day's close. On August 5, it touched a two-year high of $16.65 before settling down to its current value of $10.
Fanapt was originally developed by German pharma company Hoechst Marion Roussel, which sold it in 1997 to Titan Pharmaceuticals Inc. (TTNP.PK), who in turn sold the rights to Swiss drug giant Novartis AG (NVS | Quote | Chart | News | PowerRating) in 1998. Vanda acquired the rights to Fanapt (Iloperidone) from Novartis in 2004.
In October, Vanda inked a $465 million deal with Novartis from which it originally licensed the rights to Fanapt in 2004. The deal provides Vanda an upfront payment of $200 million for rights to commercialize Fanapt in the U.S. and Canada. The drug is expected to hit pharmacy shelves early next year. Vanda is also eligible to receive $265 million in milestone payments. The company is also planning to create a once-a-month injectable formulation of Fanapt to ensure better compliance than the twice-daily pill version.
Fanapt is said to have some potential advantages in tolerability and safety. According to Datamonitor, global sales of antipsychotics reached $18.2 billion in 2008.
Vanda also has an investigational insomnia drug, Tasimelteon (VEC-162), which it had licensed from Bristol-Myers Squibb in 2004. Last June, Vanda released the results of a late-stage study of Tasimelteon, which met the primary goal of improving the onset of sleep though the first eight nights. Vanda expects to submit a marketing application for Tasimelteon in the U.S. in mid-2011.
Israel's fledgling biotech company Protalix Biotherapeutics Ltd. (PLX | Quote | Chart | News | PowerRating) was an off-the-radar stock until a few months back. The stock was trading around $4 when it was featured on our site in June . The stock touched a two-year high of $12.50 on November 9 before retracing to the current price of $10. The rally came amid a successful late-stage study of Protalix' lead product candidate Uplyso, formerly known as prGCD, for the treatment of Gaucher (pronounced Go-shay) disease as well as Genzyme Inc. (GENZ | Quote | Chart | News | PowerRating)'s production woes at its Allston facility.
Though Gaucher is a rare disease, the market for Gaucher drugs is huge due to the severity of the symptoms and the chronic nature of the disease. Gaucher disease is an inherited genetic disorder, in which patients lack the normal form of the glucocerebrosidase, or GCD enzyme that breaks down specific fat molecules. The lack of this enzyme results in the accumulation of fat in liver, spleen and bone marrow.
The current standard of care for Gaucher patients is enzyme replacement therapy and Genzyme's Cerezyme is currently the only approved enzyme replacement therapy for Gaucher disease. Last year, Cerezyme fetched $1.2 billion in sales for Genzyme.
The production of Cerezyme has been impacted following the temporarily closure of Genzyme's Allston facility in June due to viral contamination. In the third-quarter of 2009, Cerezyme sales plunged 69.7% to $93.6 million.
Unlike Cerezyme, which is a mammalian cell expressed version of GCD enzyme, Uplyso is a plant cell expressed version of the GCD enzyme and therefore do not carry the risk of infection by human or other animal viruses, according to Protalix.
Protalix' Uplyso enjoys orphan product designation and fast track development status and was developed under a Special Protocol Assessment. The drug is available to Gaucher disease patients in the U.S. and other countries under an Expanded Access Program approved by the FDA.
The company anticipates completing the rolling submission of a New Drug Application for Uplyso to the FDA and other comparable regulatory agencies in other countries later this quarter.
Meanwhile rumors that Pfizer Inc. (PFE | Quote | Chart | News | PowerRating) or Israeli drug giant Teva Pharmaceutical Industries Ltd. (PFE | Quote | Chart | News | PowerRating) could be eyeing Protalix continue to swirl. Protalix has had a collaboration and licensing agreement with Teva since September 2006 for the development and manufacture of two protein Biologics using Protalix' ProCellEx protein expression system.
Though Protalix CEO David Aviezer has reportedly said that the company has no plans to sell itself at present, he has not completely ruled out such a possibility if the offer is irresistible.
For comments and feedback: contact editorial@rttnews.com
Copyright(c) 2009 RTTNews.com, Inc. All Rights Reserved
Let's take a look at the upcoming catalysts of the above-mentioned stocks, which have endured wild swings.
Dendreon Corp. (DNDN | Quote | Chart | News | PowerRating) has been a regular topic at RTTNews.com. The stock was trading around $6 when it was featured on our site in 2007 and around $5 in 2008 . The stock now trades around $28.
Dendreon is a classic example of a company with a steely determination to bring its drug to market, despite hurdles and challenges. Following its success in a pivotal late-stage study of Provenge dubbed IMPACT in April of this year, the company filed its amended application with the FDA seeking approval of Provenge on November 2, ahead of its schedule of mid-November.
Provenge, an investigational vaccine for the treatment of prostate cancer, works by stimulating the immune system to recognize a protein known as the prostatic acid phosphatase or PAP, which is found in about 95% of all prostate cancer cells and mounts an attack on the cancer cells.
This is Provenge's second go-around with the FDA. Dendreon filed for approval of Provenge in 2007 and an FDA Advisory Committee voted 17-0 in favor of the prostate cancer vaccine's safety and 13-4 that it demonstrated "substantial efficacy." That the FDA did not approve Provenge despite the advisory panel's favorable votes and requested more data is now part of the Dendreon story.
With the company now having successfully re-filed its application for Provenge, the FDA is expected to announce its decision on May 1, 2010. Assuming Provenge is launched by mid-2010, the company expects the vaccine to be manufactured at its New Jersey facility to garner sales of $60 million to $125 million in the first six months after launch. The New Jersey facility will initially operate at 25% capacity and is anticipated to reach its full capacity in the first half of 2011. When the new manufacturing plants in Atlanta and Los Angeles reach their full production capacity by the end of 2011, the potential annual sales of Provenge are estimated to be $1.2 billion to $2.5 billion.
When biopharmaceutical company Targacept Inc. (TRGT | Quote | Chart | News | PowerRating) reported positive top-line results from a mid-stage study of its investigational drug TC-5214 as an add-on therapy with citalopram for major depressive disorder on July 15 , little did anyone realize that the stock would have a rapid rise from $3 to where it is now - over $23.
The detailed results of the mid-stage study presented in October revealed that the add-on TC-5214 arm had a six-point advantage in the HAM-D ratings scale compared to the add-on placebo arm, which is of high statistical significance.
According to analysts, the efficacy and safety profile of TC-5214 looks much better than Bristol-Myers Squibb Co.'s (BMY | Quote | Chart | News | PowerRating) marketed depression drug Abilify. The sales of Abilify, which was originally approved for schizophrenia in adults in November 2002, have been on the rise since the drug's approval for the expanded indication of major depression as an add-on treatment. For the third-quarter ended September 30, 2009 global sales of Abilify totaled $653 million, reflecting an increase of 16% over the year-ago quarter.
On a recent conference call, Targacept's President and CEO, Don deBethizy said that the company is in talks to identify a strategic partner to help in the global development and commercialization of TC-5214. The investigational drug is expected to advance to phase III development in the second quarter of 2010.
Targacept's other product candidates include AZD3480 (TC-1734) for ADHD, which has completed a phase II study successfully; AZD1446 (TC-6683), a product candidate for Alzheimer's disease that has completed initial phase I single and multiple raising dose clinical trials and advanced to a phase I safety and tolerability study in healthy elderly volunteers; and TC-5619, a product candidate for cognitive dysfunction in schizophrenia that is expected to enter a phase II clinical proof of concept trial shortly. The company also has a pre-clinical product candidate for depression and anxiety disorders, TC-5685.
AZD3480 (TC-1734) for ADHD and AZD1446 (TC-6683) are being developed in collaboration with AstraZeneca plc (AZN | Quote | Chart | News | PowerRating). Targacept also has a strategic alliance with GlaxoSmithKline plc (GSK | Quote | Chart | News | PowerRating) for its pre-clinical programs focused in therapeutic areas namely, smoking cessation, obesity, pain, addiction and Parkinson's disease.
Human Genome Science Inc. (HGSI | Quote | Chart | News | PowerRating) is yet another hot biotech stock of the year, whose value has soared more than ten-fold since July, thanks to success of the company's lupus drug Benlysta in late-stage trials. The stock was trading around $2.25 when an article on Benlysta was featured on our site in May and today the stock trades around $28.
Lupus is a tough disease and the market for lupus drugs is even tougher, given the string of failures. Genelabs Technologies' Prestara, Aspreva's CellCept, La Jolla Pharmaceutical Co.'s (LJPC | Quote | Chart | News | PowerRating) Riquent and Biogen Idec Inc.'s (BIIB | Quote | Chart | News | PowerRating) cancer drug Rituxan have all met with disappointment in lupus studies. But Human Genome's Benlysta stands as an exception.
Having successfully cleared two phase III trials, Benlysta represents new hope for lupus patients. It has been over 50 years since the FDA approved a drug for lupus.
Benlysta, formerly known as LymphoStat-B, is being developed by Human Genome Sciences and GlaxoSmithKline under a co-development and commercialization agreement signed in August 2006. The companies plan to submit marketing applications for Benlysta in the first half of 2010 in the U.S., Europe and other regions. According to Piper Jaffray analyst Edward Tenthoff, Benlysta sales could reach $6 billion by 2016.
However, not everything has been smooth along the way for Human Genome. The company's anthrax treatment Raxibacumab, formerly called ABThrax, failed to win FDA approval as the regulators sought more information last month in order for the drug to be approved. The company is planning to address the questions raised by the FDA related to Raxibacumab.
Human Genome also has another investigational drug that has successfully completed two late-stage trials, Zalbin for chronic hepatitis C. Zalbin, formerly called Albuferon, is being developed in partnership with Novartis AG (NVS | Quote | Chart | News | PowerRating). In both the phase III trials, it has been proved that with half as many injections, Zalbin met its primary efficacy endpoint by achieving a rate of sustained virologic response comparable to Swiss drug giant Roche's Pegasys, which is the market leader worldwide in hepatitis C therapy. Pegasys generates annual sales of over $1.6 billion for Roche. Human Genome is expected to submit an application seeking regulatory approval to market Zalbin later this quarter.
The turnaround story of Vanda Pharmaceuticals Inc. (VNDA | Quote | Chart | News | PowerRating) has all the ingredients of a good thriller. Once written-off for dead, the stock has made a remarkable comeback following FDA approval of its antipsychotic drug Fanapt, also known as Iloperidone.
Vanda was founded in 2003 by Mihael Polymeropoulos, an executive who ran the Novartis global Pharmacogenetics department. The company went public in April 2006 at $10 a share. After a negative ruling from the FDA on Fanapt last July and the stock price plummeting to $0.90, Vanda faced pressure from its shareholders to liquidate the company. Vanda was trading around $0.83 when an article highlighting the impending FDA decision and shareholder activism was featured on our site in March of this year.
Fanapt is Vanda's first-ever product to be approved. The FDA approval of Fanapt on May 7 sent the stock soaring to $7.84, an increase of 625% from the previous day's close. On August 5, it touched a two-year high of $16.65 before settling down to its current value of $10.
Fanapt was originally developed by German pharma company Hoechst Marion Roussel, which sold it in 1997 to Titan Pharmaceuticals Inc. (TTNP.PK), who in turn sold the rights to Swiss drug giant Novartis AG (NVS | Quote | Chart | News | PowerRating) in 1998. Vanda acquired the rights to Fanapt (Iloperidone) from Novartis in 2004.
In October, Vanda inked a $465 million deal with Novartis from which it originally licensed the rights to Fanapt in 2004. The deal provides Vanda an upfront payment of $200 million for rights to commercialize Fanapt in the U.S. and Canada. The drug is expected to hit pharmacy shelves early next year. Vanda is also eligible to receive $265 million in milestone payments. The company is also planning to create a once-a-month injectable formulation of Fanapt to ensure better compliance than the twice-daily pill version.
Fanapt is said to have some potential advantages in tolerability and safety. According to Datamonitor, global sales of antipsychotics reached $18.2 billion in 2008.
Vanda also has an investigational insomnia drug, Tasimelteon (VEC-162), which it had licensed from Bristol-Myers Squibb in 2004. Last June, Vanda released the results of a late-stage study of Tasimelteon, which met the primary goal of improving the onset of sleep though the first eight nights. Vanda expects to submit a marketing application for Tasimelteon in the U.S. in mid-2011.
Israel's fledgling biotech company Protalix Biotherapeutics Ltd. (PLX | Quote | Chart | News | PowerRating) was an off-the-radar stock until a few months back. The stock was trading around $4 when it was featured on our site in June . The stock touched a two-year high of $12.50 on November 9 before retracing to the current price of $10. The rally came amid a successful late-stage study of Protalix' lead product candidate Uplyso, formerly known as prGCD, for the treatment of Gaucher (pronounced Go-shay) disease as well as Genzyme Inc. (GENZ | Quote | Chart | News | PowerRating)'s production woes at its Allston facility.
Though Gaucher is a rare disease, the market for Gaucher drugs is huge due to the severity of the symptoms and the chronic nature of the disease. Gaucher disease is an inherited genetic disorder, in which patients lack the normal form of the glucocerebrosidase, or GCD enzyme that breaks down specific fat molecules. The lack of this enzyme results in the accumulation of fat in liver, spleen and bone marrow.
The current standard of care for Gaucher patients is enzyme replacement therapy and Genzyme's Cerezyme is currently the only approved enzyme replacement therapy for Gaucher disease. Last year, Cerezyme fetched $1.2 billion in sales for Genzyme.
The production of Cerezyme has been impacted following the temporarily closure of Genzyme's Allston facility in June due to viral contamination. In the third-quarter of 2009, Cerezyme sales plunged 69.7% to $93.6 million.
Unlike Cerezyme, which is a mammalian cell expressed version of GCD enzyme, Uplyso is a plant cell expressed version of the GCD enzyme and therefore do not carry the risk of infection by human or other animal viruses, according to Protalix.
Protalix' Uplyso enjoys orphan product designation and fast track development status and was developed under a Special Protocol Assessment. The drug is available to Gaucher disease patients in the U.S. and other countries under an Expanded Access Program approved by the FDA.
The company anticipates completing the rolling submission of a New Drug Application for Uplyso to the FDA and other comparable regulatory agencies in other countries later this quarter.
Meanwhile rumors that Pfizer Inc. (PFE | Quote | Chart | News | PowerRating) or Israeli drug giant Teva Pharmaceutical Industries Ltd. (PFE | Quote | Chart | News | PowerRating) could be eyeing Protalix continue to swirl. Protalix has had a collaboration and licensing agreement with Teva since September 2006 for the development and manufacture of two protein Biologics using Protalix' ProCellEx protein expression system.
Though Protalix CEO David Aviezer has reportedly said that the company has no plans to sell itself at present, he has not completely ruled out such a possibility if the offer is irresistible.
For comments and feedback: contact editorial@rttnews.com
Copyright(c) 2009 RTTNews.com, Inc. All Rights Reserved
For full details on Targacept (TRGT) TRGT. Targacept (TRGT) has Short Term PowerRatings at TradingMarkets. Details on Targacept (TRGT) Short Term PowerRatings is available at This Link.
For full details on Protalix Biotherapeutic (PLX) PLX. Protalix Biotherapeutic (PLX) has Short Term PowerRatings at TradingMarkets. Details on Protalix Biotherapeutic (PLX) Short Term PowerRatings is available at This Link.
For full details on Dendreon Corporation (DNDN) DNDN. Dendreon Corporation (DNDN) has Short Term PowerRatings at TradingMarkets. Details on Dendreon Corporation (DNDN) Short Term PowerRatings is available at This Link.
For full details on Human Genome Sciences (HGSI) HGSI. Human Genome Sciences (HGSI) has Short Term PowerRatings at TradingMarkets. Details on Human Genome Sciences (HGSI) Short Term PowerRatings is available at This Link.
For full details on Vanda Pharmaceuticals Inc (VNDA) VNDA. Vanda Pharmaceuticals Inc (VNDA) has Short Term PowerRatings at TradingMarkets. Details on Vanda Pharmaceuticals Inc (VNDA) Short Term PowerRatings is available at This Link.
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