A positive jobs report overcame investor concerns about trade on Friday, and the Dow Jones Industrial Average (DJINDICES:^DJI) and the S&P 500 (SNPINDEX:^GSPC) closed the day and the week in the green.
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Biotech shares soared on good news from clinical trials; the iShares NASDAQ Biotechnology ETF (NASDAQ:IBB) gained 3.8%. The tech sector also had a big day, with the Technology Select Sector SPDR ETF (NYSEMKT:XLK) jumping 1.2%.
Encouraging Alzheimer's trial boosts Biogen
Shares of Biogen soared 19.6% after the company announced results from a midstage clinical trial that showed one of its Alzheimer's drug candidates slowed progression of the disease.
The phase 2 trial of BAN2401, an anti-amyloid beta protofibril antibody that Biogen is developing along with its Japanese partner Eisai, tested the various doses of the drug against a placebo in 856 patients with early Alzheimer's disease. At the highest dose level, the drug met the trial's primary endpoint of change in a composite score that measures the clinical symptoms of the disease. The study also showed a statistically significant reduction of amyloid levels in the brains of test subjects.
"The prospect of being able to offer meaningful disease-modifying therapies to individuals suffering from this terrible disease is both exciting and humbling," said Chief Medical Officer Alfred Sandrock, M.D., Ph.D. "These BAN2401 18-month data offer important insights in the investigation of potential treatment options for patients with Alzheimer's disease and underscores that neurodegenerative diseases may not be as intractable as they once seemed."
Some doubt was cast on the drug's prospects last December when Biogen and Eisai announced that the criteria for success had not yet been met at the 12-month mark. Now the companies say that BAN2401 "began" to show statistically significant clinical benefit as early as six months, including at 12 months.
Numerous trial failures for drugs targeting Alzheimer's have highlighted the difficulty in finding treatments for the disease. But Biogen has six drugs in development for Alzheimer's, including two in later, phase 3 trials, so today's results have investors encouraged about the company's chances to score a big commercial win in the space, despite the fact that the drug is still a long way from commercialization.
PriceSmart misses profit expectations
PriceSmart, an operator of wholesale club stores in Latin America and the Caribbean, announced fiscal third-quarter results that didn't meet up with analyst expectations, and the stock fell 10.7%. Revenue increased 7.1% to $782 million and earnings per share fell $0.01 to $0.61. The stock is not closely followed on Wall Street, but the three analysts who cover it expected the company to earn $0.74 on revenue of $784 million.
Net merchandise sales growth was 5.6% and comparable-store sales increased 2.7%. Comparable sales in Central America, the company's biggest region, fell 1%, which the company attributed to a new warehouse store opening that siphoned off some sales from existing stores nearby. Comps in the Caribbean increased 4.5% and in Colombia soared 17.9%. Income from membership fees jumped 6.8%.
Gross margin as a percentage of total revenue increased to 16.6% from 15.4% in the period a year earlier. Operating income grew 2.9% to $28.4 million. Profit in the quarter was hurt by an $8 million expense related to the acquisition of Aeropost, a cross-border logistics and e-commerce provider that PriceSmart bought in March.
PriceSmart, founded by the same father-and-son team that founded Price Club and later merged with Costco Wholesale, is building a similar member-based warehouse chain in Latin America and the Caribbean.