What happened
Shares of Arrowhead Pharmaceuticals (ARWR +0.80%) rose over 14% last month, according to data provided by S&P Global Market Intelligence. The stock actually had gains nearly double that on Nov. 9, when it announced two late-breaking poster presentations at the Annual Meeting of the American Association for the Study of Liver Disease (AASLD). Why is that important?
Getting into an important medical meeting after the abstract submission deadline is difficult to do, but companies with exceptional data can coax conference schedulers into letting them grab a microphone and some floor space in the poster hall. Turns out, Arrowhead Pharmaceuticals didn't disappoint with its two late-breakers.
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So what
In the first poster, Arrowhead Pharmaceuticals presented data for ARO-HBV as a treatment for chronic hepatitis B virus (HBV). The third-generation RNA interference (RNAi) therapy demonstrated an average viral reduction of 98.7% with a range of 95% to 99.98%. The drug is being developed in an ongoing phase 1/2 clinical trial with Janssen, which forked over an upfront milestone payment of $175 million in October.
In the second poster, Arrowhead Pharmaceuticals presented data for ARO-AAT as a treatment for alpha-1 antitrypsin (AAT) deficiency. The second-generation RNAi therapy demonstrated promising potential to reduce levels of AAT in the blood (the disease is called AAT deficiency, but defective copies of the AAT protein can accumulate in the liver and cause scarring and liver diseases). Patients receiving a single 200 mg or 300 mg dose saw AAT levels reduced over 90% for at least six weeks. Patients receiving one injection of either dose per month for three months sustained greater than 90% reductions of AAT for 14 weeks.
Arrowhead Pharmaceuticals thinks the data for ARO-AAT suggest it may be feasible to pursue a treatment option of one 300 mg dose per quarter, or perhaps even less frequently.
Now what
A little over one year ago, Arrowhead Pharmaceuticals had a market cap of less than $120 million following some missteps in the clinic, but its new focus on next-generation RNAi therapies is certainly paying off now. The biopharma has earned a market cap of $1.2 billion today. While there's still a long way to go to wrap up the ongoing phase 1 studies and initiate a phase 2 study for each ARO-HBV and ARO-AAT, let alone gain marketing approval, existing shareholders might just have a winner on their hands. Investors looking to begin a new position might want to wait for a pullback before jumping in, although the new partnership with Janssen significantly de-risks this biopharma stock.
