Biotech stocks took a beating Wednesday on fears that companies in the sector have become overvalued after an extended updraft. The Wall Street Journal published a story highlighting investor anxiety over the bull run, noting that a 240% gain in the NASDAQ Biotechnology Index since the beginning of 2012 has far outpaced the NASDAQ-100 Technology Sector Index's 82% gain over the same period. Big caps such as Gilead Sciences Inc. (NASDAQ:GILD), Amgen Inc. (NASDAQ:AMGN), Biogen (NASDAQ:BIIB) and Celgene Corp. (NASDAQ:CELG) each have gained tens of billions of dollars in market cap over the past year.
The BioCentury 100 shed 335.99 (4.6%) to 6,949.67 on Wednesday, and has lost 7.6% since Friday's close. The NYSE Arca Biotechnology (BTK) lost 179.26 (4.4%) to 3,940.81 on Wednesday, and is down 7.1% since Friday. With the end of 1Q15 looming next Tuesday, profit-taking could exacerbate a sell-off.
Among the biggest decliners on Wednesday were Esperion Therapeutics Inc. (NASDAQ:ESPR), off $15.51 (15%) to $87.23; Novavax Inc. (NASDAQ:NVAX), down $1.27 (14%) to $7.98; and Cempra Inc., which lost $4.96 (14%) to $31.49.
Others seeing stock drops of greater than 10% included Sage Therapeutics Inc. (NASDAQ:SAGE), down $6.87 (13%) to $45; Acceleron Pharma Inc. (NASDAQ:XLRN), off $4.97 (12%) to $36.78; and Neurocrine Biosciences Inc. (NASDAQ:NBIX), which fell $4.65 (11%) to $36.37.
Only four stocks in the BioCentury 100 gained value Wednesday, while 96 lost ground. Forward Pharma A/S (NASDAQ:FWP), the biggest gainer, picked up $0.75 to $23.25 after reporting earnings.
Amgen Inc. (NASDAQ:AMGN) filed an appeal to the U.S. Court of Appeals for the Federal Circuit (CAFC) Wednesday, after a district court last week denied the company's motions intended to prevent the Sandoz unit of Novartis AG (NYSE:NVS; SIX:NOVN) from launching Zarxio filgrastim-sndz, a biosimilar of Amgen's Neupogen filgrastim.
Yesterday, Amgen filed a motion with the district court for a preliminary injunction that would delay Sandoz's launch of Zarxio until the CAFC resolves Amgen's appeal. The district court hearing is scheduled for April 30, but both companies have requested a hearing date as early as April 2. If the motion is denied, Amgen said it will file a motion for an injunction pending appeal with the CAFC.
Sandoz has agreed not to launch Zarxio in the U.S. until the earlier of May 11 or a ruling by the CAFC on Amgen's application for an injunction pending appeal.
Amgen and Sandoz have agreed to request an expedited review of the appeal and an oral argument date as early as June. Proceedings related to Amgen's U.S. Patent No. 6,162,427, including Amgen's claim of infringement and Sandoz's counterclaims of noninfringement and invalidity, remain for trial and will be suspended until the CAFC issues a mandate on Amgen's appeal.
Last week, the U.S. District Court for the Northern District of California denied Amgen's motions for a preliminary injunction and ruled that Sandoz did not violate the Biologics Price Competition and Innovation Act of 2009 (BPCIA) when it refused to provide its BLA to Amgen. Furthermore, the court had dismissed Amgen's claim that Sandoz violated the BPCIA when it gave Amgen its 180-day notice of intent to market Zarxio in advance of FDA approving the drug (see BioCentury Extra, March 19).
FDA approved Zarxio earlier this month, making it the first approved biosimilar product in the U.S. (see BioCentury Extra, March 6).
FDA approved Eylea aflibercept from Regeneron Pharmaceuticals Inc. (NASDAQ:REGN) to treat diabetic retinopathy in patients with diabetic macular edema (DME). The human fusion protein that binds all forms of VEGF-A and placental growth factor (PGF; PlGF) has breakthrough therapy designation in the indication and was under Priority Review.
Eylea already is approved in the U.S. for wet age-related macular degeneration (AMD), macular edema following branch or central retinal vein occlusion (RVO) and DME. FDA based its approval for the new indication on data from the Phase III VISTA-DME and VIVID-DME trials, in which Eylea led to significant improvements in diabetic retinopathy severity scale (DRSS) scores compared to macular laser photocoagulation.
Eylea's recommended dosing schedule is 2 mg every 8 weeks, after five initial monthly injections.
In February, FDA approved Lucentis ranibizumab, an anti-VEGF drug from the Genentech Inc. unit of Roche (SIX:ROG; OTCQX:RHHBY), to treat diabetic retinopathy in patients with DME. Lucentis is dosed at 0.3 mg once a month to treat DME (see BioCentury Extra, Feb. 6).
An NIH-sponsored comparative effectiveness study published last month in the New England Journal of Medicine showed that Eylea led to greater improvements in vision than Lucentis or Avastin bevacizumab, an anti-VEGF drug from Genentech, in certain patients with DME (see BioCentury Extra, Feb. 18).
Regeneron lost $19.75 to $453.99 on Wednesday amid a larger selloff for biotechs.
FDA approved a BLA for Anthrasil anthrax immune globulin IV (AIGIV) from Emergent BioSolutions Inc. (NYSE:EBS) to treat inhaled anthrax. The drug, developed using plasma collected from healthy donors vaccinated with the company's BioThrax, has Fast Track and Orphan Drug status from FDA.
Emergent gained rights to the product through its acquisition of Cangene Corp. last year. Anthrasil is being developed under a $160 million contract, awarded in 2005, with HHS's Biomedical Advanced Research and Development Authority (BARDA). FDA's approval triggers a $7 million milestone payment to Emergent from BARDA.
On Tuesday, Emergent signed a separate $31 million contract with BARDA to develop NuThrax (AV7909), a third-generation vaccine that consists of the adsorbed anthrax vaccine BioThrax and an immunostimulatory compound called CPG 7909 for post-exposure prophylaxis of anthrax disease. The company is preparing to conduct a Phase III trial of NuThrax. Emergent said that in a Phase II trial, a two-dose schedule of NuThrax showed better tolerability and immunogenicity vs. three doses of its BioThrax, the only FDA-approved vaccine to prevent anthrax.
Pain company Egalet Corp. (NASDAQ:EGLT) hired Wendy Niebler as SVP of clinical development and medical affairs, a newly created position. Niebler was VP and head of global medical affairs at PTC Therapeutics Inc. (NASDAQ:PTCT).
VBL Therapeutics Ltd. (NASDAQ:VBLT) gained $1.63 (29%) to $7.22 on Wednesday after VB-111 met the primary endpoint of improving overall survival (OS) in a Phase II trial to treat recurrent glioblastoma multiforme (GBM).
Patients received VB-111 followed by a combination of VB-111 and Avastin bevacizumab from Roche (SIX:ROG; OTCQX:RHHBY) or Avastin alone after disease progression. The combination led to a statistically significant benefit in median OS of 414 days compared to 235 days for the arm receiving Avastin alone (p=0.05). Full results will be presented at the American Society of Clinical Oncology meeting (ASCO) in May.
VBL plans to start a Phase III trial of VB-111 in mid-2015 under an SPA from FDA, and expects data in 2H16. The company disclosed in an SEC filing that it will need additional funding to complete the trial.
Last month, FDA removed a partial clinical hold on VB-111. FDA had placed the hold last July and requested details from VBL regarding the candidate's potency release assay.
The gene-based dual anti-angiogenic and vascular disruptive agent (VDA) that uses Vascular Targeting System (VTS) technology has Fast Track designation in the U.S. and Orphan Drug designation in the U.S. and EU to treat GBM. VB-111 is also in Phase II testing for thyroid cancer and Phase I/II testing for ovarian cancer.
VBL's shares have yet to recover last month's losses on news that it planned to discontinue development of VB-201 in plaque psoriasis and ulcerative colitis (UC) after the compound missed the primary and secondary endpoints in two Phase II trials for the indications (see BioCentury Extra, Feb. 17).
Immunotherapy company Cellectis S.A. (Euronext:ALCLS; NASDAQ:CLLS) lost $2.20 to $39.30 in its first day of trading on NASDAQ on Wednesday after raising $228.3 million through the sale of 5.5 million American Depositary Shares (ADSs) at $41.50. Last month, the company filed to raise up to $115 million in the financing; the company then amended the offering, indicating that it planned to sell 3.5 million ADSs.
BofA Merrill Lynch; Jefferies; Piper Jaffray; Oppenheimer; and Trout Capital are underwriters. The company has been listed since 2007 on Euronext, where the stock lost EUR 3.60 to EUR 36.40 on the day.
Cellectis expects to submit a CTA in the U.K. this year to begin a Phase I trial of UCART19, which consists of chimeric antigen receptor (CAR)-modified CD19-targeted allogeneic T cells, to treat chronic lymphocytic leukemia (CLL) or acute lymphocyctic leukemia (ALL). It expects preliminary data in 2016. Servier (Neuilly-sur-Seine, France) has an option to acquire a worldwide license to the program under a February 2014 deal.
Cellectis closed a EUR 20.5 million ($28.2 million) private placement in March 2014 with OrbiMed Advisors; venBio; Ridgeback Capital; Aquilo Capital; and Merlin Nexus.
The company received $80 million up front in a June 2014 deal that gave Pfizer Inc. (NYSE:PFE) a license to develop cancer immunotherapies using the biotech's CAR T cell technology (see BioCentury, July 14, 2014).
ZS Pharma Inc. (NASDAQ:ZSPH) raised $185.7 million through the sale of 4 million shares at $46.25 in an bumped-up follow-on underwritten by JPMorgan; Credit Suisse; BMO Capital Markets; William Blair; and LifeSci Capital. The company proposed to sell 3.3 million shares on Monday, when its stock was at $46.65. ZS lost $4.59 to $42 on Wednesday.
The company plans to submit an NDA to FDA next quarter and an MAA to EMA next half seeking approval of lead candidate sodium zirconium cyclosilicate (ZS-9) to treat hyperkalemia. In September 2014, the inorganic crystal form of zirconium silicate designed to trap potassium ions over other ions throughout the GI tract met the primary endpoint of preventing hyperkalemia recurrence compared with placebo in the Phase III HARMONIZE trial (see BioCentury Extra, Sept. 23, 2014).
The SEC adopted final changes to Title IV of the Jumpstart Our Business Startups (JOBS) Act of 2012 that it says will make it easier for smaller companies to raise capital in public offerings.
Smaller companies can now sell up to $50 million of securities within a 12-month period through Regulation A offerings, which are exempt from some registration requirements. The previous cap was $5 million.
The rules provide for two tiers of offerings: Tier 1 offerings are limited to $20 million within a 12-month period, with no more than $6 million sold by affiliates of the issuer, while Tier 2 offerings can be up to $50 million, with no more than $15 million sold by affiliates. Tier 2 offerings are exempt from certain state registration requirements; Tier 1 offerings are not, although Tier 2 offerings are subject to stricter disclosure and reporting requirements.
The new rules will take effect 60 days after a notice of the changes is published in the Federal Register.
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