Opexa Therapeutics, Inc. (NASDAQ: OPXA) is on fire this morning with investor interest. The company announced that it has successfully completed two End-of Phase 2 meetings with the FDA over its Tovaxin. This is the company’s lead-product candidate and is said to be the first ever personalized T-cell therapy aimed as multiple sclerosis.
The company believes that these FDA meetings put Opexa in position to move forward with a pivotal Phase 3 study of Tovaxin, which Opexa preparing for to being the Phase III study.
A Phase 2b study of Tovaxin demonstrated overall clinical and disability benefits over the placebo group, including a clinically relevant decrease in the Annualized Relapse Rate and improvement in disability score. Another benefit beyond the efficacy measures that the FDA will ultimately evaluate is the safety profile. Opexa notes an “excellent safety profile” with no serious adverse events related to the Tovaxin treatment.
There are MS drugs on the market. Biogen Idec Inc. (NASDAQ: BIIB), which we recently covered as having risen above analyst expected targets, has the great MS drug called TYSABRI. Unfortunately, the adverse effects that have greatly limited TYSABRI are rare instances of the potentially fatal brain infection PML.
It is probably too soon to call for a change of treatment regimens based upon already approved drugs against drug-candidates that still have to go through Phase III trials for broader data before the application process can even begin. That being said, what makes Tovaxin different from current MS treatments is that it is a personalized cellular immunotherapy treatment. It is derived from T-cells isolated from a patient’s peripheral blood, which is then expanded ex-vivo, and ultimately reintroduced into the patient by injection. This process then triggers an immune response against specific subsets of autoreactive T-cells known to attack myelin, which reduces the relapse risks through time.
Opexa noted, “The second meeting was a face-to-face End of Phase 2 clinical meeting in which Opexa presented its rationale and trial design for a Phase 3 pivotal study with Tovaxin in Relapsing Remitting-MS (RR-MS) patients. The FDA concurred with Opexa regarding its proposed clinical trial protocol including the patient population, end points, patient numbers and trial design. The FDA also offered several recommendations to further enhance a Phase 3 trial.”
Opexa is one we highlighted before on positive stem cell safety profiles. Opexa is also one that has not been without controversy and has not been without financial liquidity measures. Novartis (NYSE: NVS) put the company on the map on news in 2009 that it was acquiring the company’s stem cell technology.
The war against MS is a large one. The National Multiple Sclerosis Society lists on its site that there are approximately 400,000 people with multiple sclerosis in the United States alone, with 200 more new cases diagnosed every week. The Society also noted that MS is thought to affect more than 2.1 million people on the planet.
It is still too soon to know if Tovaxin will be the next big MS treatment. The FDA is a tricky institution and approvals have been more scrutinized of late. So you know the good news, and you have at least some of the caveats.
The market is voting this one as a success today. Opexa shares are up almost 60% at $2.49 on almost 6 million shares as of 11:30 AM EST. The high for the day is $2.90 and the 52-week trading range is $1.02 to $3.07.
Even after the big gain, Opexa has a micro-cap value of only $45.9 million. The company’s cash and equivalents was listed as only $4.73 million as of September 30, 2010. Another round of funding is probably a safe assumption for the near future. The company has noted funding and partner searches and the press release today noted: “Moving forward we are focused on implementing the necessary steps to advance toward a Phase 3 clinical trial, continuing discussions with potential development partners for Tovaxin and attempting to secure appropriate financing.”
If the company’s new MS treatment is as good as the investor reaction is signaling today, that funding should be easy enough to secure. The question to ask on funding is probably “how much and when?” over other issues.
JON C. OGG
It is already 2011 and we have begun the coverage of our annual outlook series. We covered the best of 2010 and an outlook for big-biotech stocks with the most implied upside already. Sometimes it is important to know also which of the big biotech and biohealth names may be overvalued when it comes to analyzing the current price and valuation data. We have compiled data on the active biotech stocks which have at least five analysts making price target calculations for a year ahead. What we found was that a whole slew of companies were trading above the Thomson Reuters mean consensus price target objectives. That does not assure that the analysts are right, but it means that either the analysts will have to play catch-up with price hikes or that they will be considering downgrading their expectations.
Our screen generated the following names: Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN), Biogen Idec Inc. (NASDAQ: BIIB), Exelixis, Inc. (NASDAQ: EXEL), Illumina, Inc. (NASDAQ: ILMN), Jazz Pharmaceuticals, Inc. (NASDAQ: JAZZ), Medivation, Inc. (NASDAQ: MDVN), Osiris Therapeutics, Inc. (NASDAQ: OSIR), and Sequenom, Inc. (NASDAQ: SQNM).
Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN) is way off its highs but may still be overvalued. The company is seeking expanded approval for its BYETTA along with Basal insulin for diabetes but it may not be enough unless the analysts are missing the boat here. At $14.80 and with a market cap of $2.1 billion, its 52-week trading range is $9.51 to $24.21. The unfortunate issue is that Amylin’s consensus price target is $13.21 and the great huge hope here has yet to pay off for the company. For whatever it is worth, Amylin’s CEO Dan Bradbury was given the honor of “The worst biotech CEO in 2010″ just last month.
Biogen Idec Inc. (NASDAQ: BIIB) has handily recovered from its past woes, perhaps recovered too much if analysts are anywhere close. Shares are now trading at $67.20, with a market cap of $16.01 billion and a 52-week range of $45.96 to $68.60. The consensus analyst target is listed as $62.83. In early December Credit Suisse only gave a neutral rating but did assign a $68 target. Biogen Idec was also reiterated Neutral but its target was raised to $70 at BofA/Merrill Lynch.
Exelixis, Inc. (NASDAQ: EXEL) may be overvalued to formal targets and maybe not… It came back in focus in November-2010 on news that Phase II clinical trial data on XL184 in ovarian and prostate cancer showed that the drug appears to be a help in both tumor types after it was effectively given back rights to the drug by Bristol-Myers Squibb earlier. Share shave jumped and jumped and now trade at $8.49 with a market cap of $925 million and a 52-week trading range of $2.86 to $9.20. Unfortunately, its consensus price target is $7.75 and there have been shares registered for sale by insiders over the last month.
Illumina, Inc. (NASDAQ: ILMN) was one of the best of the best in 2010, but that was then and this is about valuations. The most recent price of $64.34 generates an $8.05 billion market cap and its 52-week trading range is $29.76 to $66.59. We’ll be looking for analysts to catch up or for the stock to back off because the consensus target is listed as $60.34 still. This is on the instrument side of the biohealth sector in integrated systems for the analysis of genetic variation and biological function.
Jazz Pharmaceuticals, Inc. (NASDAQ: JAZZ) appears on the list of ‘overvalued’ biohealth names apparently just over extreme end of year performance in November and December. Jazz shares rocked higher from under $11.00 per share to right at $20.00 for its most recent $19.96 close. The market cap is about $776 million and the 52-week range is $6.38 to $20.28. The consensus target is $16.80. Its sleep-disorder treatment Xyrem recently won a new patent for narcolepsy and it has seven other Xyrem patents that expire between 2019 and 2024. It also raised guidance in November after swinging to a better profit. Jazz is still greatly under-followed by analysts with only 5 real targets out there. This may be a situation of catching-up that is needed by analysts rather than a major concern that something is wrong at Jazz.
Medivation, Inc. (NASDAQ: MDVN) imploded early in 2010 on an Alzheimer’s disappointment. Shares are now around $16.09 with a $556 million market cap and a very wide trading range of $8.43 to $40.49. Unfortunately, its consensus price target is $14.50 per share.
Osiris Therapeutics, Inc. (NASDAQ: OSIR) is tricky considering that it aims for the stem cell therapeutic segment. At $7.77, its market cap is $255 million and its 52-week trading range is $5.39 to $9.24. Unfortunately, its consensus target is $5.88. Shares have been in a trading range for more than a year after a big sell-off and there is just an information gap that implies that Osiris could end up like “Ra” or “Rat” if you forgive the Egyptian mythology pun.
Sequenom, Inc. (NASDAQ: SQNM) is currently back up off its post-implosion lows. The investing public has no idea how lucky they are that it is even still a public and traded company because it could have disintegrated entirely. Shares are trading around $7.85 and have a market cap of almost $600 million and a 52-week trading range of $3.91 to $8.65. The consensus price target is unfortunately $7.13
Sequenom was an interesting name in the screen even if it is more into diagnostics rather than cures. It recently raised capital at $6.00 per share, so it has popped rather well. The $7.85 price is trading above the $7.13 consensus price target. Piper Jaffray initiated coverage with an Overweight rating in mid-December and gave it a $8.00 price target.
As you can see, being screened as ‘overvalued’ may be no fault of the company and may not even matter in the long-term development plans of a company. Sometimes stocks outperform the market and they can outperform enough that the analysts have either not updated their coverage or maybe it was ‘too much too fast’ in that performance.
JON C. OGG
Geron Corporation (NASDAQ: GERN) is punishing its speculating stem cell investing shareholders in the after-hours session after the close on Monday. The company has announced an offering of stock to raise capital. That is bad for current holders in that it is dilutive, but it is good for the company as it is raising capital and all of the shares being sold are being sold by the company.
No formal share size was offered up in the release for its underwritten public offering, but it did note that Geron also expects to grant the underwriters a 30-day option to purchase up to an additional 15% of the shares of common stock offered in the public offering to cover over-allotments.
While shares are lower, the company did recently announce a move to Phase II in breast cancer studies. That should probably make this share sale of only a small surprise to many.
The offering is subject to market conditions, although these offerings usually price in very short order after biotech companies signal a share sale is imminent like this.
The company is selling shares via J.P. Morgan Securities and Lazard Capital Markets LLC as the joint book-running managers of the offering.
Geron shares closed up 1.8% at $6.12 after the close against a 52-week range of $4.37 to $6.67 and shares are trading down under $5.70 in the after-hours session.
The market cap as of the close was listed as roughly $627 million. As of September 30, 2010, Geron listed on the balance sheet $35.28 million in cash and equivalents, another $91.05 million in short-term investments, and $19.856 million in long-term investments.
Here is our link for the stem cell companies when there were some funding bans if you want to see the other companies in the stem cell sector.
JON C. OGG
Geron Corporation (NASDAQ: GERN) is taking its breast cancer study with stem cells to Phase II. The company announced this morning the enrollment of the first patient in a randomized Phase 2 clinical trial of its telomerase inhibitor drug, imetelstat (GRN163L), in combination with paclitaxel (with or without bevacizumab) in patients with locally recurrent or metastatic breast cancer.
The Phase I program and preclinical data that showed imetelstat’s activity against cancer stem cells from a broad range of tumor types, including breast cancer. The Phase I trial of imetelstat combined with paclitaxel and bevacizumab showed an encouraging preliminary response rate.
The Phase II trial is an open label, multi-center, randomized study to measure safety and efficacy. The primary efficacy endpoint is to estimate progression-free survival (PFS) for patients receiving imetelstat in addition to paclitaxel with or without bevacizumab. Secondary efficacy endpoints are objective response rate and clinical benefit of imetelstat when added to paclitaxel with or without bevacizumab. Safety and tolerability will also be assessed.
Enrollment is estimated at 150 patients at approximately 80 clinical sites across the U.S. and Canada.
It was back on November 11, 2010 when Geron relreased data showing that two publications demonstrating results of its telomerase inhibitor and shares rose to $6.08 from $5.80 the prior day.
Geron closed Wednesday at $5.96 and its 52-week trading range is $4.37 to $6.67.
JON C. OGG
The Department of Justice, the White House, and many other activists have been steadily trading to get the ban lifted on the stem cell funding that surprised the entire biotech, drug, and stem cell research community. Now it seems that a U.S. District Court has suspended that ban on state-funded embryonic stem cell research.
Geron Corporation (NASDAQ: GERN) is now up 9% at $5.34 versus a 52-week trading range of $4.37 to $7.51. Geron recently received an FDA lifting of a clinical trial hold involving spinal cord injuries.
StemCells Inc. (NASDAQ: STEM) is up 7% at $0.83 versus a 52-week range of $0.75 to $1.79. This one recently had positive paralysis study data and our indications were that much or all of the operations here were not really going to be hurt or hit from the funding bans.
Aastrom Biosciences, Inc. (NASDAQ: ASTM) is up 2.7% at $1.52 versus a 52-week range of $1.32 to $4.16.
Cytori Therapeutics, Inc. (NASDAQ: CYTX) is up 4.8% at $4.86 and the 52-week range is $2.93 to $9.50.
Neostem, Inc. (AMEX: NBS) is up 2.3% at $1.77 versus a 52-week trading range of $1.26 to $3.50. As we have outlined before, NeoStem is actually tied to adult stem cells rather than embryonic stem cells.
International Stem Cell Corporation (ISCO.OB) is one that had a pending funding of $10 million back in July.
BioTime, Inc. (NASDAQ: BTIM) is down 5.2% at $4.56 versus a 52-week range of $3.02 to $8.42. BioTime recently noted that a peer reviewed Regenerative Medicine publication showed that the aging of human cells can be reversed.
JON C. OGG
Pluristem Therapeutics, Inc. (NASDAQ: PSTI) is up 12.87% this morning after it announced that its PLX therapeutic stem cell line, derived from the material of a human placenta, would be the only type of cell selected for a study designed to prevent inflammatory heart disease, also called diastolic heart failure.
Shares of PSTI is up $0.13 to $1.14 on 172 thousand shares of volume, more than three times the average daily volume of 48,248 shares. the stock is mid-way through its 52-week range of $0.82 to $1.52.
-Michael B. Sauter
StemCells, Inc. (NASDAQ: STEM) is the talk of the town this morning after it showed published reports of a mice study using human neural stem cells reverse paralysis.
The publication of new preclinical data showed that the company’s proprietary human neural stem cells restored lost motor function in mice with chronic spinal cord injury. This is the first published study to show that human neural stem cells can restore mobility even when administered at time points beyond the acute phase of trauma.
The company suggests that the prospect of treating a much broader population of injured patients is now more than previously demonstrated. The paper was published yesterday in the international peer-reviewed journal PLoS ONE, and is available online at http://dx.plos.org/10.1371/journal.pone.0012272.
“Human Neural Stem Cells Differentiate and Promote Locomotor Recovery in an Early Chronic Spinal Cord Injury NOD-scid Mouse Model” was the name of the study and was led by Dr. Aileen Anderson of the Sue and Bill Gross Stem Cell Research Center at the University of California, Irvine.
StemCells’ human neural stem cells were transplanted into mice 30 days after a spinal cord injury that results in hind limb paralysis. The transplanted mice demonstrated a significant and persistent recovery of walking ability in two separate tests of motor function when compared to control groups.
The company further noted that these results are particularly significant because it is the first time that human neural stem cells have been shown to promote functional recovery in a chronic spinal cord injury setting, which is characterized as a point in time after injury in which inflammation has stabilized and behavioral recovery has reached a plateau. In humans, the chronic phase typically does not set in until several weeks or months following the injury.
In the pre-market trading at 8:00 AM EST, shares are up 18.5% at $1.03 versus a 52-week trading range of $0.84 to $1.79.
JON C. OGG
Geron Corporation (NASDAQ: GERN) was up $0.74 (15.42%) to $5.54 on news that the FDA has lifted their hold on a clinical trial that will test embryonic stem cells as a means of treating spinal cord injuries. Tests for the treatment, called GRNOPC1, were put on hold in August after some mice developed microscopic spinal cysts during research.
Geron Corporation is a biopharm company that develops biopharmaceuticals for the treatment of cancer and chronic degenerative diseases, such as spinal cord injury, heart failure, and diabetes.
-Michael B. Sauter
StemCells, Inc. (NASDAQ: STEM) has created some interest in the stem cell sector again on some important safety news. While today’s news is best for StemCells, Inc. (NASDAQ: STEM) as a company, this will only act to highlight others involved in stem cell research. We are also seeing moves in Geron Corporation (NASDAQ: GERN), Neostem, Inc. (AMEX: NBS), and Opexa Therapeutics, Inc. (NASDAQ: OPXA).
The company (StemCells) announced that Nathan Selden (M.D., Ph.D., F.A.C.S., F.A.A.P.) is presenting a feature presentation today at the American Association of Neurological Surgeons 2010 Annual Meeting. This is said to be one of the leading forums for neurosurgeons from around the world to present and discuss cutting-edge research in the field.
StemCells, Inc. (NASDAQ: STEM) has a new stem cell patent. For rats, issued in the United Kingdom. The company issued a release showing that the United Kingdom Intellectual Property Office granted patent number GB2451523.
The patent has broad claims covering true rat stem cells and genetically engineered rats derived from these cells, which is expected to have significant utility to academic and pharmaceutical industry researchers by enabling them to create novel rat models for the study of human diseases.
The company noted that both mice and rats are used by scientists to model various human diseases, but also noted that rat models are more frequently used by pharmaceutical companies because the physiological characteristics of rats make them better suited for assessing drug efficacy and toxicity.
StemCells Inc. (NASDAQ: STEM) now holds an exclusive license to commercialize this technology and is globally prosecuting the patent family that claims it. The company further noted that this is the first patent granted anywhere in the world that protects the derivation and use of pluripotent rat stem cells and the creation of genetically engineered rats. It also noted that this is the missing link to create rat models for a wider range of human diseases.
The patent details composition of matter claims to pluripotent stem cells of the rat, which includes both embryonic stem cells and induced pluripotent stem cells; and it also covers genetically engineered rat models derived from such cells.
Because of the stem cell news yesterday, there seems to be a higher interest than on normal stem cell patent announcements. Right before the open we have shares up almost 5% at $1.27 on 340,000 shares. Average volume is 2.1 million shares and the 52-week trading range is $1.02 to $1.94.
JON C. OGG