Please ensure Javascript is enabled for purposes of website accessibility

Here's Why Juno Therapeutics' Stock Is Bolting Higher

By George Budwell - Jul 13, 2016 at 8:49AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The FDA lifts the hold on Juno's lead CAR-T therapy.

Image source: Getty Images.

What: Shares of the clinical-stage biotech Juno Therapeutics (JUNO)  gained as much as 30% in pre-market trading today on the news that the FDA lifted the clinical hold on its lead product candidate JCAR015, a novel form of cellular therapy known as chimeric antigen receptor T cells (or CAR-T for short). The rival CAR-T developer Kite Pharma (NASDAQ: KITE) is also benefiting from this news, with its shares up by nearly double digits in pre-market trading. 

To get the study back on track, Juno requested to modify the trial protocol by excluding the chemotherapy fludarabine from the pre-conditioning regimen. As a refresher, Juno's stock plummeted last Friday after the company disclosed that the FDA placed a clinical hold on JCAR015 following two patient deaths in the therapy's ongoing mid-stage trial in adult patients with relapsed or refractory B cell acute lymphoblastic leukemia (ALL). 

So what: Right after the hold was made public, Juno immediately suggested that the addition of fludarabine to the trial's protocol was the main culprit in these deaths. And, apparently, the FDA is in agreement, given that the hold was lifted in only a matter of days. 

Now what: Juno's stated goal is to be among the first to bring a CAR-T therapy to market -- perhaps following closely behind Kite's KTE-C19 as a possible treatment for aggressive non-Hodgkin lymphoma. Now that this clinical hold has been lifted, Juno may indeed be able to achieve this lofty goal. But the company's rather aggressive commercialization strategy is going to depend on JCAR015's ability to continue to produce unprecedented response rates in ALL without the use of fludarabine.

As CAR-T therapies in general have been plagued by safety concerns pretty much from the get-go, I'm not convinced there's a compelling reason to rush into these speculative biotech stocks right now. After all, Kite and Juno are both working on refining their CAR-T product pipelines in light of these outstanding safety issues, and it's still unclear if CAR-Ts will turn out to be viable first lines of therapy.


Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Juno Therapeutics, Inc. Stock Quote
Juno Therapeutics, Inc.

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/18/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.