This Week in Biotech: The FDA, NICE, and DOJ Weigh In

In part two of This Week in Biotech, we examine a mix of six companies impacted by regulatory approval and enforcement agencies this past week.

Jan 11, 2014 at 11:43AM

It was a truly remarkable week for the biotech sector, with two companies practically doubling and another shooting higher by 545%.

In Part 1 of "This Week in Biotech," we examined the four clinical trials, one announced partnership, and one buyout of the week tht made waves. Now, we're going to move onto what actions from the Food and Drug Administration, National Institute for Health and Care Excellence, and U.S. Department of Justice moved biotech stocks in a big way.

Let's start off with the four FDA actions which biotech-savvy investors need to know.

It's approved!
We only had one approval granted this week, and it came from GlaxoSmithKline (NYSE:GSK), which had its advanced melanoma drugs Mekinist and Tafinlar approved for use in combination with one another. If you recall, in May the FDA approved both drugs to treat the BRAF V600E and V600K mutations, but only as single-agent monotherapies. Yesterday's approval, though, clears the way for the first advanced melanoma combo drug to hit the market. In trials, 76% of patients taking the combo had their cancer shrink or disappear for a median time of 10.5 months. By comparison, only 54% of patients taking Tafinlar by itself demonstrated objective responses with a median response of just 5.6 months. The combo, along with molecular diagnostic test, should give Glaxo a leg up on other advanced melanoma treatments currently on the market.

Moving to the fast lane
On Monday, clinical-stage biopharmaceutical company Peregrine Pharmaceuticals (NASDAQ:PPHM) put its blinker on and shifted over to the fast lane after it announced that the FDA had granted its second-line immunotherapy treatment for non-small-cell lung cancer, bavituximab, the fast-track designation. This designation allows Peregrine more frequent interaction between it and the FDA and could lead to an expedited review of its cancer drug. In addition, Peregrine also announced that it had begun initiating its phase 3 trial known as Sunrise for bavituximab. With Peregrine's mid-stage study marred by an outside clinical lab, investors will be looking for consistently impressive results in phase 3 trials if Peregrine is going to regain its highs achieved in 2012.

Circle your calendars
After nearly two years of waiting and two FDA rejections, MannKind (NASDAQ:MNKD) investors can circle April 1 on their calendars as the day that the Endocrinologic and Metabolic Drugs Advisory Committee will review its inhaled diabetes drug, Afrezza. As the Fool's Brian Orelli points out, neither time previously had the FDA reviewed Afrezza before its PDUFA decision, so this might be a best course of action for MannKind. The company's latest trial results showed clinically impressive A1C reductions, although the effect wasn't as pronounced in type 1 diabetics, and there were a higher number of hypoglycemic events with type 2 diabetics compared with the control arm. Still, MannKind's inhaled diabetes drug has the potential to rapidly improve convenience of delivery, assuming the FDA agrees. Is the third time the charm? We'll know more in three months.

A "brief" look at trouble to come?
For shareholders in Chelsea Therapeutics (NASDAQ:CHTP), it was once again time to play ostrich on Friday, with its shares dipping 29% after briefing documents posted on the FDA's website ahead of its Jan. 14 advisory panel meeting alluded to a possibly complex decision ahead. The briefing documents note that Cheslea's experimental drug Northera for neurogenic orthostatic hypotension demonstrated "strong evidence" of its effectiveness in the short term (one to two weeks), but that its effectiveness over the long run has yet to be determined by any concrete data. What complicates matters even more is that droxidopa (the scientific name for Northera) comprises three of its four ongoing trials. Another rejection here could send this stock reeling.

Well isn't that NICE?
Struggling cancer therapy developer Cell Therapeutics (NASDAQ:CTIC) received some "NICE" news this week after the National Institute for Health and Care Excellence in the United Kingdom deemed its multiply relapsed or refractory B-cell non-Hodgkin lymphoma drug, Pixuvri, as cost-effective. In other words, as soon as CTI launches Pixuvri in the U.K., which it plans to do in the early spring, physicians will have access to it as a third or fourth-line treatment. While certainly a positive for CTI, it'll need a lot more than just Pixuvri if it hopes to erase a decade full of share dilution and immense losses from the minds of shareholders.

The DOJ comes knocking
Last, but certainly not least, we have Aegerion Pharmaceuticals (NASDAQ: AEGR), which dipped by 11% on Friday after reporting its preliminary fourth-quarter results, issuing its 2014 sales forecast, and announcing that it had received a subpoena from the U.S. Department of Justice. That last note is what sent shares lower on the week. The subpoena revolves around Aegerion's marketing practices surrounding homozygous familial hypercholesterolemia drug, Juxtapid. Although Aegerion has agreed to cooperate with the investigation, the overhang from such an investigation could last months and may result in a monetary penalty for the company. I believe investors have been given more than ample reason to keep their distance from Aegerion for the time being.

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Fool contributor Sean Williams owns shares of Bank of America, but has no material interest in any other companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

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4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

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KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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