At one point today, shares of Geron (NASDAQ: GERN ) were up more than 116%. Although some of those gains were given up later, the stock still enjoyed a fantastic surge after the abstract about a forthcoming presentation on use of the company's drug imetelstat in treating myelofibrosis was published online. Is this only a euphoric surge, or could Geron jump even higher?
Fire from ASH
The aforementioned abstract was posted on the American Society of Hematology, or ASH, website earlier today. Dr. Ayalew Tefferi and his team at the Mayo Clinic are scheduled to present initial results from a mid-stage investigator-sponsored study on Dec. 9. The abstract title itself gave away the good news from the study: "Imetelstat, a Telomerase Inhibitor, Induces Morphologic and Molecular Remissions In Myelofibrosis and Reversal of Bone Marrow Fibrosis."
Two words from that title stand out -- remissions and reversal. The Mayo Clinic study found that five patients out of 18 patients included in the abstract analysis achieved either complete remission or partial remission. Another three patients experienced clinical improvement. The four patients that achieved complete remission also experienced reversal of bone marrow fibrosis.
The implications of these results could be huge. Incyte's (NASDAQ: INCY ) Jakafi, which is the only product on the market that is currently approved for myelofibrosis, can't produce remissions or bone marrow fibrosis reversal. Shares of Incyte opened more than 5% lower on the Mayo Clinic news but later recovered.
Other myelofibrosis drugs in development are also JAK2 inhibitors like Jakafi. Cell Therapeutics (NASDAQ: CTIC ) is in a late-stage study with pacritinib. Gilead Sciences (NASDAQ: GILD ) has a couple of JAK2 inhibitors in its pipeline -- momelotinib in phase 3 and simtuzumab in phase 2. Should imetelstat's results hold up under closer scrutiny, both companies could feel pressure with those development programs.
But will the Mayo Clinic results actually convincingly show imetelstat's superiority? That's the potentially multibillion-dollar question. The abstract doesn't discuss spleen reduction, which is one of the key clinical improvement response criteria for myelofibrosis. Interestingly, the International Working Group team that established the response criteria was led by none other than Dr. Ayalew Tefferi from the Mayo Clinic.
After the jump
What happens with Geron's stock following today's huge jump depends largely on what the ASH presentation reveals. Geron might be able to shed a little more light on the subject in their quarterly results conference call Thursday evening. However, remember that this study wasn't conducted by the company. At minimum, the promising results seems to solidify the likelihood that Geron will move ahead as expected with its own phase 2 study focusing on myelofibrosis in early 2014.
It's definitely still early in the game. There are plenty of questions to be answered about imetelstat. Accordingly, there are still plenty of ways that Geron's stock could run into trouble. However, if imetelstat is able to achieve spleen reduction and remission, Geron could be one of the biggest biotech stories over the next few years.
Investors would probably be wise to see what is said at ASH before making their own jump into Geron's stock. If imetelstat turns out to deliver on today's promising results, there still will be plenty of opportunity to profit in the days ahead.
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