Let's take a look at today's top stories in biotech and health care. Keep an eye out for GW Pharmaceuticals (GWPH), Inovio Pharmaceuticals (INO -0.34%) and Novavax (NVAX -4.82%)
GW scores Fast Track status for its experimental treatment for Dravet syndrome
Shares of GW Pharmaceuticals are up close to 6% in premarket trading this morning after the company announced that the Food and Drug Administration granted Fast Track designation to its cannabidiol product Epidiolex as a potential treatment for Dravet syndrome. Dravet syndrome is a rare and devastating form of childhood epilepsy that currently lacks a cure. Individuals afflicted with the disorder tend to be resistant to most treatments, showing the need for new therapies.
What's important to understand is that Fast Track status will allow GW to have more frequent contact with the FDA during the drug's development and potentially allow the drug to reach the market sooner. Per the release, GW plans on initiating a combined mid and late-stage study for Epidiolex in the second half of this year.
Inovio's reverse split completed
Shares of the DNA vaccinemaker Inovio Pharmaceuticals have reportedly completed their 1 for 4 reverse split and are set to start trading at a higher price this morning. What's key to understand is that stocks tend to be highly volatile following reverse splits and today's action in Inovio probably won't stray from this trend.
Looking ahead, you shouldn't expect Inovio's volatility to subside until after the top line data readout for the company's lead clinical candidate VGX-3100, which is expected within the next two months. As such, investors with a long-term outlook may want to wait until after these data are released before considering a position.
Investors displeased with Novavax's offering price, shares slump further
Yesterday, Novavax announced a $100 million offering of its common stock that caused shares to drop over 11% for the day. This morning shares are down another 7% in premarket following a release of the details of the offering.
Specifically, the company announced that it priced this underwritten public offer of 25 million shares at $4.00 a share. Some quick back of the envelope math shows that this offering is therefore being executed at a noteworthy 21% discount compared to Wednesday's closing price.
While investors that bought prior to this drop may be unhappy with this offering price, I think the company's promising vaccine pipeline, headlined by its RSV franchise, could be reason to consider taking advantage of this pullback -- or at least investigating the company more closely. After all, the company should now be flush with cash and shouldn't need to raise funds again until one of its clinical candidates has reached the regulatory review stage.
