What: Following a presentation at an investor conference last Thursday, shares in Celldex Therapeutics (NASDAQ:CLDX) surged 12.4% higher on Friday.
So what: Since August, a broad-based sell-off across biotech has led to the entire industry losing ground; however, shares in Celldex Therapeutics have been hit especially hard.
The company lost 28.9% of its value in September because investors continued to rein in optimism that its promising brain cancer drug Rintega would qualify for an accelerated FDA approval,
In phase 2 trials, Rintega's ability to delay tumor growth in glioblastoma patients sparked hope that it could net a faster pathway to market; however, in August, management revealed it will need to finish its phase 3 trial before the FDA will consider a Rintega application.
Last Thursday, at a Leerink Partners conference, Celldex Therapeutics indicated that the FDA's cautious approach to Rintega is because the phase 2 data was based on a small patient population. That's not too surprising given that the React study wasn't designed to support an application in the first place, but instead to further explore Rintega's potential.
Although a delay to Rintega's timeline is disappointing, results from the company's ongoing ACT IV phase 3 trial are expected in November 2016 and since ACT IV includes more patients, its results may be more indicative of Rintega's efficacy and safety anyway.
Now what: Rintega's results show benefit in progression free survival and overall survival when compared to non-study controls in phase 2 and an interim analysis of the ACT IV trial that could confirm or refute that finding is expected either late this year or early next year when the trial hits its 75% completion mark
In addition to Rintega, Celldex Therapeutics is also developing glembatumumab vedotin to be used as part of combination therapy in melanoma patients with an amenable genetic make-up and varlilumab, which is being studied across a variety of cancers.
Because a lot of needle-moving news could come out of Celldex Therapeutics in the coming year, there's a lot of risk; however, for investors willing to take the chance of a Rintega phase 3 failure, using the recent slide in the company's shares as an opportunity to pick up shares for long-term portfolios could prove to be profit-friendly if results are good enough to lead to an eventual FDA approval.