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Why ZIOPHARM Oncology Inc. Published a Higher Stock Price Today

By Brian Orelli, PhD - Feb 23, 2016 at 4:43PM

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The biotech got a scientific paper published, but the devil is in the detail.

What: ZIOPHARM Oncology (ZIOP 1.19%) ended Tuesday up about 14% after announcing that it had a study published in Scientific Reports.

So what: The paper shows how eliminating the expression of a protein called human leukocyte antigen-A (HLA-A) using Sangamo Biosciences'(SGMO 9.02%) zinc finger nucleases can make it easier to transplant hematopoietic stem cells and restore bone marrow function.

In mice.

ZIOPHARM's press release conveniently leaves out that detail. While it's a nice proof-of-concept study, investors should keep in mind that scientists can treat a lot of diseases in mice that can't yet be treated in humans.

Interestingly Sangamo Biosciences ended the day down 6%. Admittedly, getting the technique to work isn't as important to Sangamo Biosciences' valuation, but the drop still suggests ZIOPHARM's investors might be overreacting just a bit.

Now what: Finding matched donors for hematopoietic stem cells transplants is difficult because there are multiple components -- HLA-A, HLA-B, HLA-C, and HLA-DRB1 -- that need to match to avoid rejecting the transplant. By removing HLA-A, ZIOPHARM is trying to make off-the-shelf treatments that can treat a wide variety of patients.

It's certainly good that researchers at ZIOPHARM and its academic partner The University of Texas MD Anderson Cancer Center were able to get the system working in mice, but investors should still be cautious until they can show that the process works in humans.

Brian Orelli and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Stocks Mentioned

ZIOPHARM Oncology, Inc. Stock Quote
ZIOPHARM Oncology, Inc.
ZIOP
$1.70 (1.19%) $0.02
Sangamo Therapeutics Stock Quote
Sangamo Therapeutics
SGMO
$5.20 (9.02%) $0.43

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