With the SPDR S&P Biotech Index up 17% 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.
Perhaps the two lead biotech stories this week came from the regulatory side of the coin with PTC Therapeutics (NASDAQ:PTCT) soaring and Provectus Biopharmaceuticals (NYSEMKT:PVCT) hitting the deck.
PTC Therapeutics practically doubled at one point on Friday before settling into a gain of 31% after announcing a positive decision from the Committee for Medicinal Products for Human Use, or CHMP -- the equivalent of Europe's FDA panel -- for its lead investigational drug translarna (also known as ataluren in the U.S.), which would grant the therapy conditional marketing approval to treat nonsense mutation Duchenne muscular dystrophy. There are no approved therapies to treat nmDMD at the moment, and the phase 2b study being used to recommend granting this conditional marketing authorization showed that translarna patients improved in the six-minute-walking-distance test by 31.3 meters relative to the placebo after 48 weeks. Gains were even more noticeable in patients who had progressed further in the disease and couldn't walk at least 350 meters. It should be noted that PTC still needs to run a phase 3 study of its therapy, and DMD drugs that had succeeded in phase 2 have failed in phase 3 previously, so investors should remain cautiously optimistic moving forward.
On the other side of the coin Provectus received a double-whammy following its listing on the NYSEArca exchange which included having to defend itself against investment community attacks, as well as enduring a trading halt all day Friday for news pending. That news, which surfaced in the mid-afternoon, was that metastatic melanoma injection PV-10 had been denied the breakthrough therapy designation by the Food and Drug Administration. The company made it clear that they plan to pursue the development of PV-10 even without the BTD designation, but a lack of a partner or any fresh study data for about a year and a half is making it tough for optimists to stay positive. If I were a betting man I'd probably place my wager on Provectus opening lower once its trading halt is lifted.
Shares of clinical-stage biopharmaceutical company Ophthotech (NASDAQ:OPHT) also soared this week after announcing a collaborative licensing deal with Novartis for leading wet age-related macular degeneration drug Fovista. Under the terms of the deal Ophthotech will retain all U.S. rights to the drug with Novartis licensing Fovista in all ex. U.S. territories. In return, Ophthotech gets $200 million in upfront cash, could earn $130 million in near-term milestones, and has the potential to earn $300 million in ex.-U.S. approvals and $400 million in ex.-U.S. sales milestones. While the deal certainly alleviates any cash concerns investors may have had, it'll still be two years before we even get the phase 3 data on Fovista, so investors may not want to uncork that champagne just yet.
The clinical quartet of positive data
As a special treat I'm extending this beyond the normal five stories we look at each week to seven, simply because it was that busy of a week. Here are an additional four clinical studies that made big waves this week.
No company was sung more praises by investors and Wall Street firms than Isis Pharmaceuticals (NASDAQ:IONS) which for a second straight week dazzled with clinical data. On Thursday morning Isis released phase 2 data on ISIS-FXI, a blood-thinning, venous thrombotic event, or VTE-preventing drug being investigated for use following complete knee replacement. Its study showed that the highest dose (300 mg) led to a seven-fold decline in VTE incidence compared to the placebo (which was Lovenox), and that there were no observable difference in safety between ISIS-FXI and Lovenox. If approved this could have blockbuster potential, and it again solidifies Isis as one of the deepest clinical pipelines in biotech.
InterMune (NASDAQ:ITMN) also equally pleased investors earlier this week after releasing additional ASCEND phase 3 data at the American Thoracic Society meeting in San Diego. According to InterMune's press release, it notes that 22.7% of patients taking pirfenidone, its investigational idiopathic pulmonary fibrosis therapy that's known as Esbriet in Europe, experienced no decline in forced vital capacity from baseline to week 52 compared to just 9.7% of patients in the placebo group, for a 132.5% improvement. It notes that additional studies from the New England Journal of Medicine had similar conclusions about the benefits of pirfenidone relative to the current standard of treatment. The evidence is mounting and it's looking ever more likely that pirfenidone is on its way to being approved to treat IPF in the U.S. However, I would caution investors that at a valuation of $4 billion all of that optimism and some has likely been baked into its share price.
Also at the American Thoracic Society meeting, clinical-stage biopharmaceutical company Insmed (NASDAQ:INSM) unveiled new data on an open-label mid-stage study of its lead investigational compound Arikayce. The therapy, designed for treatment-resistant nontuberculous mycobacterial (NTM) lung infections produced 21 patients that were NTM-negative by day 168 in an 84-day extension trial out of 78 patients. This includes 10 NTM-negative patients at day 84, five additional by day 168, and another six that were switched over from the placebo in the open-label study by day 168. While Arikayce has met a number of key secondary endpoints and impressed with its negative culture readouts relative to the placebo, it's also failed to meet its primary endpoint and adverse events have been notably higher in the Arikayce arm than the placebo. I believe there are still many questions left to be answered here and would suggest sticking to the sidelines in the meantime.
Finally, on Thursday evening ZIOPHARM Oncolgoy (NASDAQ:ZIOP), a clinical-stage cancer-fighting biopharma, reported positive early stage preclinical and clinical study data on Ad-RTS-IL-12, an investigational anti-tumor and anti-cancer stem cell therapy at the American Society of Gene and Cell Therapy's annual meeting in Washington D.C. By "switching on" IL-12 ZIOPHARM has been able to increase tumor infiltration leading to notable anti-tumor activity in breast cancer and melanoma patients in phase 1 and 2 trials. In addition, Ad-RTS-IL-12 showed an anti-cancer effect in a glioma (a type of brain cancer) model, which included tumor shrinkage and prolonged survival relative to the placebo. Obviously this news is encouraging and it deems additional studies be done, but investors shouldn't get too excited until we have more tangible efficacy data to grasp onto.
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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.
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