Tuesday’s Top Health Care Stories: BioCryst, Durata, Bristol-Myers Squibb, and Incyte

Let's take a quick look at four stocks -- BioCryst (NASDAQ: BCRX  ) , Durata Therapeutics (NASDAQ: DRTX  ) , Bristol-Myers Squibb (NYSE: BMY  ) , and Incyte (NASDAQ: INCY  ) -- which could all make health care headlines this Tuesday morning.

BioCryst surges on positive results for BCX4161
Shares of BioCryst are up more than 23% in pre-market trading today, after the company announced that its experimental drug, BCX4161, was effective at reducing attacks of hereditary angioedema (HAE) -- a rare genetic disease characterized by sudden swelling of the skin -- when compared to placebo. BioCryst stated that patients given the drug during a mid-stage trial had an average rate of 0.82 attacks per week, compared to 1.27 attacks for the placebo group.

Of the four main HAE treatments on the market -- Shire's (NASDAQ: SHPG  ) Cinryze and Firazyr, Dyax's Kalbitor, and CSL Behring's Berinert -- only Cinryze is administered as a preventative measure. The other three drugs are only administered when attacks occur.

Therefore, BCX4161 could become a major competitor for Cinryze, which Shire acquired through its $4.2 billion acquisition of ViroPharma last year. Last quarter (which included its first two months of owning Cinryze), Shire reported $85.6 million in Cinryze sales. Analysts at JPMorgan believe that Cinryze could eventually generate peak sales north of $700 million. Hopes are even higher for BioCryst's BCX4161 -- Roth Capital Partner analysts believe that sales could hit $1 billion by 2023.

Durata slides following the approval of Dalvance
Shares of Durata Therapeutics were down more than 23% in pre-market trading today, possibly a case of profit-taking following the FDA approval of the company's first marketed drug, Dalvance, last Friday. Prior to the approval, shares of Durata had rallied 45% since April 14, when it hit a low of $11.68. Shares have since recovered to a more moderate pre-market loss of 6%.

Dalvance is a treatment for a serious ABSSSI (acute bacterial skin and skin structure infections) -- which can include deep tissue infections, Gram-positive infections, and infections associated with underlying diseases such as diabetes. The drug is expected to generate peak sales of $446 million by 2019, according to Thomson Reuters estimates. Prior to the drug's approval, it demonstrated non-inferiority when compared to vancomycin, a treatment which is available in generic form, and vancomycin followed by Pfizer's Zyvox (linezolid).

The company finished last quarter with $41.5 million in cash and equivalents -- a 30% decline from the prior year quarter. The company reported a GAAP net loss of $20 million, down from a narrower loss of $15.8 million a year earlier. Durata attributed the wider losses to higher general and adminstrative expenses related to the upcoming launch of Dalvance.

Bristol-Myers Squibb and Incyte announce a new collaboration
Bristol-Myers Squibb and Incyte just entered an agreement to evaluate the safety, tolerability, and preliminary efficacy of a combination regimen consisting of Bristol-Myers' nivolumab and Incyte's INCB24360 for multiple tumor types.

Nivolumab is a PD-1 immune checkpoint inhibitor, a type of immunotherapy which attempts to elicit an immune system response to fight cancerous cells. Nivolumab received an FDA Breakthrough Therapy Designation for Hodgkin Lymphoma earlier this month, which will expedite its review process. If approved, nivolumab is expected to generate peak sales as high as $6 billion.

INCB24360 is an oral indoleamine dioxygenase-1 inhibitor, and is currently testing the drug in eight early stage trials for various types of cancers.

This is not the first time Incyte has collaborated with a larger partner to test INCB24360 as part of a combination regimen. In February, Incyte entered an agreement with Merck to evaluate INCB24360 alongside Merck's MK-3475 immunotherapy in an early stage study for non-small cell lung cancer. Earlier this month, Incyte announced a collaboration with AstraZeneca to study a combination of INCB24360 with AstraZeneca's MEI4736 immunotherapy in treating multiple solid tumors.

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Leo Sun

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8/27/2015 3:16 PM
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