With the SPDR S&P Biotech Index up 21% over the trailing-12-month period, it's evident that investment dollars are willingly flowing into the biotech sector. Keeping that in mind, let's have a look at some of the rulings, studies, and companies that made waves in the sector last week. And here's a spoiler: It was all good news thanks mostly to Europe.
Isis Pharmaceuticals (NASDAQ: ISIS ) delivered one of the top performances this past week, with shares rising 22%, after reporting phenomenal mid-stage results for APOCIII Rx, its triglyceride-reducing drug for patients with high triglyceride levels and type 2 diabetes. The patient pool for the study was relatively small, just 11 patients, but it delivered a 72% reduction in triglyceride levels while boosting high-density lipoproteins (the good type of cholesterol) by 40%. Isis also commented that APOCIII Rx improved insulin sensitivity which would aid type 2 diabetes patients in maintaining proper glycemic balance. There's still a long development process left for APOCIII Rx, but you should definitely have Isis added to your Watchlist.
Raptor Pharmaceuticals (NASDAQ: RPTP ) also gave shareholders something to cheer about when, on Tuesday, the company announced that the Food and Drug Administration had granted Procysbi, its nephropathic cystinosis drug, U.S. orphan drug status. Although FDA-approved drugs are protected by patent for a period of 20 years, the U.S. orphan drug status will keep biosimilar competition from competing against Raptor's Procysbi through April 30, 2020. In addition, on Friday Procysbi received a positive opinion from the European Medicine Agency's panel that the drug be recommended for approval in the EU. However, I'd caution calmer heads prevail here as the total market for the drug is only about 2,000 people worldwide and peak sales estimates in the U.S. are a mere $60 million.
The EMA's Committee for Medicinal Products for Human Use, or CHMP, also played a big role in Halozyme Therapeutics' (NASDAQ: HALO ) huge Friday surge. The EMA's panel recommended Roche's Herceptin SC, which uses Halozyme's recombinant human hyaluronidase in a subcutaneous injection for patients with HER2-positive breast cancer. A typical infusion of Herceptin can take 30 to 90 minutes, whereas the subcutaneous injection can be delivered in a fraction of the time, two to five minutes. This new delivery method could save hospitalization time and money and improve patient comfort. It could also be a transformative approval for Halozyme.
Not to sound like a broken record, but Dendreon (NASDAQ: DNDN ) shareholders received some much-awaited positive news, and they have the EMA's panel to thank. The CHMP recommended that Dendreon's cellular immunotherapy treatment Provenge be approved in the EU for the treatment of metastatic castration-resistant prostate cancer. Dendreon has been bleeding money because of Provenge's high price tag in the U.S., which caused insurers to shy away from covering the three-course treatment, and from increased competition. It remains to be seen if this will be too little, too late for Dendreon, but it's nonetheless a big stepping stone toward an expected EU approval.
And finally, would you be shocked if I said that medical-device and drug maker Hospira (NYSE: HSP ) ended the week on a high following a positive opinion from the CHMP on its biosimilar drug known as inflectra? The drug, which is targeted at treating rheumatoid arthritis, inflammatory bowel diseases, and plaque psoriasis, is a biosimilar of Johnson & Johnson's blockbuster Remicade, which generates $6 billion in annual sales. Assuming Hospira can gain approval for inflectra (which appears likely, since the EMA often follows the advice of its panel), it could garner a big chunk of J&J's sales in the EU.
It's no secret that biotech stocks have been soaring recently, but the best investment strategy is to pick great companies and stick with them for the long term. The Motley Fool's free report "3 Stocks That Will Help You Retire Rich" shares not only stocks that could help you build long-term wealth, but also winning strategies that every investor should know. Click here to grab your free copy today.