What happened

Shares of Nektar Therapeutics (NASDAQ:NKTR) were up 11.4% as of 3:15 p.m. EST on Monday. The biotech presented data Sunday evening at the American Society of Hematology (ASH) annual meeting from a preclinical trial evaluating immunotherapy NKTR-255. Nektar also received a boost from news that Sanofi (NASDAQ:SNY) plans to acquire clinical-stage biotech Synthorx (NASDAQ:THOR) for $2.5 billion.

So what

The two stories impacting Nektar are actually related, in a way. NKTR-255 is an IL-15 agonist; Synthorx's lead candidate THOR-70 focuses on IL-2. These two targeted interleukins have similar structures. Sanofi's interest in the potential for Synthorx's lead drug arguably increases the attractiveness of NKTR-255 as well.

Gloved hands holding two test tubes

Image source: Getty Images.

In addition to the preclinical data presented on Sunday evening at ASH, Nektar is scheduled to present more data on NKTR-255 this evening. In a press release, Nektar senior vice president and head of discovery and research Loui Madakamutil said: "The preclinical data being recognized at ASH demonstrate NKTR-255's promise in hematological malignancies through its potential to restore both NK cell and memory CD8 T cell compartments in patients."

NKTR-255 is currently being evaluated in a phase 1 clinical study targeting the treatment of multiple myeloma and non-Hodgkin lymphoma (NHL). Madakamutil stated that the preclinical data presented at ASH "reinforces the basis of our ongoing clinical trial" in the two indications.

Now what

It's not uncommon for biotech stocks to jump on the news of a pending acquisition of another small biotech with similar drugs in development. Neither is it unusual for biotech stocks to spike after presenting data at ASH. However, it's important for investors to remember that Nektar has a long way to go with NKTR-255 -- and that the company isn't an acquisition target itself at this point.

However, Nektar has a lot of irons in the fire that could cause its stock to heat up even more. The most important are its pivotal clinical studies with partner Bristol-Myers Squibb, evaluating a combination of bempegaldesleukin with Opdivo in treating melanoma, urothelial cancer, and renal cell carcinoma.