This Week in Biotech: Diabetes Patients Chalk Up 2 Impressive Victories

Legal settlements and victories, an FDA approval, and two positive clinical results take center stage in this holiday-shortened week in the biotech sector.

Apr 19, 2014 at 3:15PM

With the SPDR S&P Biotech Index up 23% 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.

Laying down the law
It may have been a holiday-shortened week, but there was no shortage of legal actions to keep investors busy this week.

Shareholders in DepoMed (NASDAQ:DEPO) were treated to great news earlier this week when the company announced that it had reached a patent litigation settlement with two privately held companies that had been planning to file an abbreviated new drug application for Gralise, a medication given to patients following a bout of the shingles. The settlement, which pushes these companies from bringing generic Gralise to market before Jan. 1, 2024, helps ensure the continued exclusivity of Gralise which was DepoMed's biggest seller last year with $36.2 million in revenue. Of course, DepoMed also pointed out that it's still pursuing patent litigation against Actavis to prevent its ANDA filing.

Zogenix (NASDAQ:ZGNX) shareholders also had reason to celebrate after issuing a press release Tuesday night that announced the U.S. District Court in Massachusetts had entered an order to prevent the implementation of a sales ban on severe pain medication Zohydro ER. Massachusetts' Gov. Deval Patrick had intended to prevent the sale of Zohydro ER within the state as he felt there was a high risk for abuse of the drug.  The District Court blocked this order presumably to demonstrate that states couldn't pick and choose what drugs to allow and what not to allow, as well as reinforce the idea that the Food and Drug Administration is the official determiner of a drugs' labeling, not the individual states. While good news for Zohydro ERs potential in Massachusetts, the sheer number of questions surrounding the abuse potential of this drug make its peak sales potential very difficult to map. As such, I'm perfectly happy sticking to the sidelines.

A big week for diabetics and GlaxoSmithKline
On top of being a big week for settlements and legal victories, it was also an important week for the nearly 26 million diabetics in this country.

GlaxoSmithKline (NYSE:GSK) on Tuesday announced the FDA had approved its once-weekly subcutaneous injection Tanzeum as an adjunct treatment of type 2 diabetes in addition to proper diet and exercise. Specifically, Tanzeum is a glucagon-like peptide-1-receptor agonist which helps reduce blood glucose levels in type 2 diabetes patients. Following the approval, GlaxoSmithKline announced it would launch the drug in the third quarter.

On a side note, this wasn't Glaxo's only win this week, with it and Genmab announcing the FDA approval of Arzerra as a first-line treatment in combination with chlorambucil for chronic lymphocytic leukemia patients. Its late-stage study demonstrated statistically significant improvements in progression-free survival which made its approval rather unsurprising, but nonetheless welcome. 

The other potential win was for type 1 diabetics from the release of mid-stage data from Lexicon Pharmaceuticals (NASDAQ:LXRX) and its lead diabetes therapy LX4211. In its study LX4211 met its proof-of-concept endpoints by reducing total daily mealtime bolus insulin dose by 32% compared to just 6% for the placebo. It also significantly reduced mean HbA1c levels by 0.55% compared to just 0.06% for the placebo. Lexicon's therapy is particularly intriguing to me because it's a dual inhibitor of SGLT1 and SGLT2. There are currently two SLGT2-inhibiting therapies approved by the FDA for type 2 diabetes patients that work via the kidneys. Adding the SGLT1 inhibitor, which works in the gastrointestinal tract, could give LX4211 a comparative advantage over existing therapies, at least in the fact that it works for both type 1 and type 2 diabetes patients. I'd certainly encourage you to keep an eye on this company.

Baxter's big win
Last, but certainly not least, Baxter International (NYSE:BAX) announced that BAX 111, its recombinant therapy under investigation to treat von Willebrand disease, the most commonly inherited bleeding disorder, had met its primary efficacy endpoint in a phase 3 study as a stand-alone treatment. As Baxter's press release notes, not only did it meet its pre-specified efficacy level, but all 22 patients achieved success in treating on-demand bleeding events. Best of all, there were no out of the norm serious adverse events. Full data from its study is expected to be presented later this year with Baxter intending to file for approval of BAX 111 before the end of the year.

The next great revolutionary stock could be right under your nose. Here's 6 top picks from our co-CEO David Gardner. 
They said it couldn't be done. But David Gardner has proved them wrong time, and time, and time again with stock returns like 926%, 2,239%, and 4,371%. In fact, just recently one of his favorite stocks became a 100-bagger. And he's ready to do it again. You can uncover his scientific approach to crushing the market and his carefully chosen six picks for ultimate growth instantly, because he's making this premium report free for you today. Click here now for access.

Sean Williams has no material interest in any 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.

The Motley Fool recommends Baxter International. Try any of our Foolish newsletter services free for 30 days. 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.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.


Compare Brokers